IRAs
Your Balance Grows With Your Earnings!
TEFCU is dedicated to helping you earn more than ever before! Each type of Individual Retirement Account (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!
To open an IRA account, log into Online or Mobile Banking, select Accounts > Add an account and follow the prompts.
For more information regarding the differences between Traditional and Roth IRAs, download the following brochure > Compare: Traditional and Roth IRAs (PDF - 2.5 MB).
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*:
- Up to $146,000 for single filers
- Up to $230,000 for joint filers
How much can I contribute?
- $7,000 for 2024
- $8,000 for 2024 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- Earnings are tax-free if account is open for five tax years and withdrawn for a qualified reason (age 59 1/2, disability, death, or a first time home purchase).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.
Not intended as tax advice. Please consult a tax professional.
* MAGI - Modified Adjusted Gross Income from the federal tax form
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?
- $7,000 for 2024
- $8,000 for 2024 for owners age 50 and older
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- Earnings grow tax-deferred until withdrawn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
Not intended as tax advice. Please consult a tax professional.
COVERDELL IRA
Who can contribute?
- Anyone who has MAGI:
o Up to $95,000 - 110,000 for single filers
o Up to $190,000 - $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 (ESAs) 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
Not intended as tax advice. Please consult a tax professional.