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Transit Employees Federal Credit Union

IRAs

Your Balance Grows With Your Earnings!


TEFCU is dedicated to helping you earn more than ever before! Each type of IRA Savings Account will reward you with higher interest based on the funds you deposit at TEFCU. The more funds you deposit, the higher your earnings. It's that simple and easy. 

Looking for an even greater return? Try putting some funds into an IRA Certificate. The more you earn today, the better your Retirement can be tomorrow!

ROTH IRA+


Who can contribute?

Anyone who has income from compensation (or who is filing jointly with a spouse who earns compensation), with the following MAGI*:

  • $120,000 - $135,000 for single filers
  • $189,000 - $199,000 for joint filers
  • $11,000 for married individual filing a separate income tax return.

How much can I contribute?

  • $5,500 for 2018
  • $6,500 for 2018 for owners age 50 and older

Who can make deductible contributions?

  • No one can deduct contributions.

What are the tax advantages?

  • Earnings are tax-free if account is open for five tax years and withdrawn for a qualified reason (age 59 1/2, disability, death, or a first time home purchase).
  • Not required to start withdrawals at age 70 1/2.

When can I withdraw without restrictions?

  • Regular contributions can be withdrawn tax-free and penalty-free at any time.
  • After the account has been open five years, earnings can be withdrawn tax-free and penalty-free for any of these reasons: age 59 1/2, disability, death, and a first-time home purchase**.

Not intended as tax advice. Please consult a tax professional.
*MAGI - Modified Adjusted Gross Income from the federal tax form
**Lifetime limit for exemption on first-time home purchase is $10k
*** Formerly known as the Education IRA

*Saver's Tax Credit

The income limits associated with the income tax credit for IRA contributions and salary deferrals in retirement plans, which taxpayers calculate and claim on Form 8880, Credit for Qualified Retirement Savings Contributions, have increased. Eligibility for this tax credit is based on the individual’s age, adjusted gross income, student status, status as a dependent, and tax return filing status. The adjusted gross income limits are subject to cost-of-living adjustments. The 2016 maximum income limits for tax credit eligibility are $61,500 for joint filers, $46,125 for head of household, and $30,750 for all other filing statuses.

TRADITIONAL IRA*


Who can contribute?

  • Anyone under age 70 1/2 who has income from compensation (or who is filing jointly with a spouse who earns compensation).
  • Anyone who has received a distribution from a qualified retirement plan and decides to roll over the proceeds of the plan into an IRA.

How much can I contribute?

  • $5,500 for 2018
  • $6,500 for 2018 for owners age 50 and older

Who can make deductible contributions?

Fully-deductible contributions:

  • Single individuals not active in employer retirement plans
  • Single individuals active in employer retirement plans with MAGI of less than:
           o $63,000 - $73,000 (2018)
  • Married couples with neither spouse active in an employer retirement plan
  • Married active participant filing a joint income tax return:
           o $101,000 - $121,000 (2018)

What are the tax advantages?

  • Earnings grow tax-deferred until withdrawn
  • Contributions may be tax-deductible

When can I withdraw without restrictions?

Withdraw penalty-free for any of the following reasons:
  • Qualified higher-education expenses
  • First time home purchase
  • Age 59 1/2
  • Qualifying medical expenses exceeding 7.5% of adjusted gross income
  • Payment to beneficiaries upon owner's death
  • Payment of health insurance premiums while unemployed for 12 weeks or longer


* Saver's Tax Credit

The income limits associated with the income tax credit for IRA contributions and salary deferrals in retirement plans, which taxpayers calculate and claim on Form 8880, Credit for Qualified Retirement Savings Contributions, have increased. Eligibility for this tax credit is based on the individual’s age, adjusted gross income, student status, status as a dependent, and tax return filing status. The adjusted gross income limits are subject to cost-of-living adjustments. The 2016 maximum income limits for tax credit eligibility are $61,500 for joint filers, $46,125 for head of household, and $30,750 for all other filing statuses.


COVERDELL IRA


Who can contribute?

  • Anyone who has MAGI:
          o Up to $110,000 for single filers
          o Up to $220,000 for joint filers
  • Some people with higher MAGI may be able to make smaller contributions
  • Contributions not allowed after the beneficiary reaches age 18 (except for special needs beneficiaries)

How much can I contribute?

  • $2,000 per child each year
  • Limit applies to all Coverdell Education Savings Accounts (ESA's) for the same child
  • Who can make deductible contributions?
  • No one can deduct contributions.
What are the tax advantages?

  • Withdrawals for certain qualified education expenses are tax-free
  • Qualified education expenses include tuition, fees, books, computer equipment and technology required for elementary, secondary and post-secondary education

When can I withdraw without restrictions?

  • Withdrawals are tax-free and penalty-free only for qualified education expenses (earnings are subject to tax and penalty for most other withdrawals)
  • Funds can be transferred from one child's account to an account for another child in the family