Individual Retirement Accounts

ira couch

At KleinBank, we understand the importance of offering you IRA options to fit your INDIVIDUAL NEEDS. Our knowledgeable and experienced Retirement Experts will help you choose the IRA plan BEST FOR YOU!

18 MONTH FIXED RATE IRA RATE IRA

Open with

  • $1000 or more
  • 18 month term
  • Add deposits of $25 or more whenever it is convenient for you - automatic deposits are available

“YOUR CHOICE” CERTIFICATE IRA

Open with

  • $1000 or more
  • Choose any KleinBank Certificate of Deposit term

VARIABLE RATE OPEN-ENDED IRA

Open with

  • $100 or more
  • Add deposits of $25 or more whenever it is convenient for you - automatic deposits are available
  • Earn money market rates

We are here to help you remove any roadblocks to your retirement success. Simply call or stop in today to discuss these IRA Certificate options and other IRA investment opportunities!

 

Get Comfortable with Individual Retirement Accounts...

An Individual Retirement Account (IRA) is an excellent tool for retirement savings. Unlike most investments, depending on the type of IRA you choose, contributions may be tax deductible and will grow either tax-deferred or tax-free.

Contribution Deadlines

Contributions to Traditional IRAs and Roth IRAs must be opened and/or funded by April 15th. A filing extension will not buy you extra time.

Traditional IRAs

The annual contribution limit is $4,000 in 2006 and 2007 and $5,000 in 2008. After 2008, the contribution limit will be adjusted annually for inflation in $500 increments. The annual limit applies to any combination of IRA plans. Contributions are fully tax deductible if you are not an active participant in an employer retirement plan. Investments grow on a tax-deferred basis. Distributions must begin at age 70 1⁄2. Earnings are taxed only upon withdrawal.

Roth IRA

As long as you have earned income, you can establish and contribute to a Roth IRA even after age 70 1⁄2. While contributions are not tax deductible, contributions and earnings can be withdrawn tax-free and unlike Traditional IRAs, you are not required to begin taking required minimum distributions after reaching age 70 1⁄2. By converting your Traditional IRA to a Roth IRA, you can enjoy tax-free withdrawals. However, the amount you convert is subject to income tax now.

Make Up for Lost Time

Individuals who have reached age 50 by the end of the year will be able to make additional Catch-Up contributions to their Traditional or Roth IRA. For taxable years beginning in 2007, the additional Catch-Up amount is $1,000.

 Traditional IRA Roth IRA
Qualifications
 Must have earned income and not have reached age 70 1/2 by the end of the year. Must have earned income. There are no age restrictions.
Maximum Contributions

Taxable years beginning

 

 Taxable years beginning  
In 2007
$4,000 In 2007
$4,000
In 2008 and after
$5,000* In 2008 and after
$5,000*
Catch-Up (50 & Over)
2007 and after
$1,000 2007 and after
$1,000
Tax Status of Earnings
Tax-deferred until withdrawal. Not taxed. Earnings grow tax-free.
Contribution Restrictions
Yes, if active participant in employer retirement plan. Yes.
CONTRIBUTION PHASEOUTS
CONTRIBUTION PHASEOUTS
 
Singles
Married/Joint
    
2007 $52,000-$62,000 $83,000-$103,000 Singles $101,000-$116,000
2008 $53,000-$63,000 $85,000-$105,000 Married couples filing jointly $159,000-$169,000
      Married couples filing separately $0-$10,000
Tax Deduction
Yes. Contributions up to the limit are fully tax deductible if you are not an active participant in a retirement plan. Otherwise phaseout rules apply. No.
Penalties for Early Withdrawal

None if:

  • Over age 59 1/2
  • Death or disability
  • Qualified medical expenses
  • Certain health insurance
  • Qualified college expenses
  • 1st time home purchase (up to $10,000)
  • Due to IRS levy
  • Periodic payments

None if:

  • Over age 59 1/2
  • Death or disability
  • Qualified medical expenses
  • Certain health insurance
  • Qualified college expenses
  • 1st time home purchase (up to $10,000)
  • Due to IRS levy
  • Periodic payments
Required Distributions
 Must begin by April following year participant turns age 70 1/2. Only after death of the participant.
Contributions after age 70 1/2
Not allowed. Allowed.

*To be adjusted annually for inflation in $500 increments.