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Traditional IRAs, Roth IRAs, and Simplified Employee Pension (SEP) Plans

 

TRADITIONAL IRA

ROTH IRA

SEP IRA

Best if you want

Your money to grow tax-deferred until you retire

Both tax-free growth and tax-free withdrawals

A plan if you’re self-employed or a small business

Contribution eligibility

Until the year in which you turn 70½, with taxable compensation

Any age with taxable compensation

Only the employer can make contributions

Maximum contribution limits

Contributions Limits for 2016:

  • $5,500 if under age 50
  • $6,500 if age 50 or older

Contributions Limits for 2016:

  • $5,500 if under age 50
  • $6,500 if age 50 or older

Contributions Limits for 2016:

  • Employer contributions that are lesser of 25% of employee’s compensation or $53,000

Tax advantages

Pay no taxes until you take distributions

Tax-free when you take distributions

Pay no taxes until you take distributions

Tax deductions

Depends on:

  • Your earnings
  • Whether you (or your spouse, if married) participate in an employer’s retirement plan
  • Your tax filing status

Contributions are not deductible

The lesser of your contributions or 25% of employee’s compensation (limited to $265,000) not to exceed $53,000

If you’re self-employed, your business can generally deduct the contributions you make to your own SEP IRA

Distributions

Reportable and may be subject to income tax

Distributions are IRS penalty-free after age 59½

Tax-free after 5 year IRS holding period and you are 59½

Distribution of a contribution is IRS tax and penalty-free

Reportable and may be subject to income tax

Distributions are IRS penalty free after age 59½

Required minimum distribution

Mandatory at age 70½

None

Mandatory at age 70½

Products

Additional benefits

Learn more about
Traditional IRAs (PDF)

Learn more about
Roth IRAs (PDF)

Learn more about
SEP IRAs (PDF)

Other information

TO OPEN AN ACCOUNT: VISIT A BRANCH NEAR YOU OR CALL FOR DETAILS.

RETIREMENT

TRADITIONAL IRA

  • Best if you want your money to grow tax-deferred until you retire
  • Any age with taxable compensation is eligible to contribute
  • Maximum contribution limits
    Contributions Limits for 2016:
    • $5,500 if under age 50
    • $6,500 if age 50 or older
  • Pay no taxes until you take distributions
  • Tax deductions
    Depends on:
    • Your earnings
    • Whether you (or your spouse, if married) participate in an employer’s retirement plan
    • Your tax filing status
  • Distributions
    • Reportable and may be subject to income tax
    • Distribution are IRS penalty-free after age 59½
  • Required minimum distribution mandatory at age 70½

ROTH IRA

  • Best if you want both tax-free growth and tax-free withdrawals
  • Any age with taxable compensation is eligible to contribute
  • Maximum contribution limits
    Contributions Limits for 2016:
    • $5,500 if under age 50
    • $6,500 if age 50 or older
  • Tax-free when you take distributions
  • Contributions are not tax deductible
  • Distributions
    • Tax-free after 5 year IRS holding period and you are 59½
    • Distribution of a contribution is IRS tax and penalty-free
  • No required minimum distribution

SEP IRA

  • Best if you want a plan if you’re self-employed or a small business
  • Only the employer can make contributions
  • Maximum contribution limits
    Contributions Limits for 2016:
    • Employer contributions that are lesser of 25% of employee’s compensation or $53,000
  • Pay no taxes until you take distributions
  • Tax deductions
    • The lesser of your contributions or 25% or employee’s compensation (limited to $265,000) not to exceed $53,000
    • If you’re self-employed, your business can generally deduct the contributions you make to your own SEP IRA
  • Distributions
    • Reportable and may be subject to income tax
    • Distribution are IRS penalty-free after age 59½
    • Required minimum distribution mandatory at age 70½

View IRA products chart

Learn more about Traditional IRAs (PDF)

Learn more about Roth IRAs (PDF)

Learn more about SEP IRAs (PDF)

Which IRA is right for you? (PDF)

Moving Assets Between Retirement Plans (PDF)

TO OPEN AN ACCOUNT:
VISIT A BRANCH NEAR YOU OR CALL FOR DETAILS.
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