|
|
|
The Taxpayer Relief Act of 1997 was intended to give Americans tax breaks and a greater incentive to save. Not only did it improve the traditional IRA, but it also introduced the Roth IRA and Educational IRA. As of January 1, 2002 contribution limits for all IRA's have increased. Traditional -
Income limits have been raised so more people can make tax-deductible contributions. -
Taxes on earning are deferred until withdrawal. -
Tax-deferred compounding of earnings may reduce your tax bill each year. -
Qualified distributions are penalty free for a first-time home purchase and higher education expenses.
Yearly contribution limit:: $5,000.00 Roth -
Contributions are made with after tax dollars and may be withdrawn at any time. -
Earnings may be withdrawn tax-free and penalty free under a variety of conditions. -
There are no required minimum distributions. -
Contributions are allowed after age 70 1/2.
Yearly contribution limit: $5,000.00 Educational An Educational IRA can be a smart way to save for your child's college education. Although contributions to an Education IRA are not tax- deductible, your withdrawals (including earning) are tax-free if used for tuition, books, and other qualified higher-education expenses. Yearly contribution limit: $5,000.00 Term Certificates For both the Traditional and Roth IRAs the Credit Union offers term certificates (CDs) which pay higher dividends.
|
|
