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For depositors looking for an insured investment with a higher return than a regular savings account, Rollstone Bank & Trust offers a variety of CD options. Choose from regular or retirement certificates.
CERTIFICATES OF DEPOSIT
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Terms from three months to five years
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Tiered interest rate structure pays higher rate on higher account balances
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Principal is guaranteed by Federal Deposit Insurance Corporation
RETIREMENT CERTIFICATES
Traditional Retirement Account
A Traditional Individual Retirement Account (T-IRA) is a special savings plan authorized by the Federal government to help you accumulate funds for your retirement, tax deferred. The earnings you accumulate in your T-IRA, including interest and dividends, remain tax deferred until withdrawn. Every individual who has earned income or receives alimony may contribute to a Traditional IRA. Income from other sources such as investments or inheritances does not qualify. Contributions may not be made for or after the year in which participant reaches the age of 70 1/2.
Rules for Spousal IRAs: Spousal IRA rules enable married couples filing jointly to contribute the maximum amount to separate Roth IRA accounts even if one spouse has no earned income.
Contribution Limits
Total yearly contributions that can be made to all IRAs, Traditional (deductible, nondeductible) and Roth, has been increased. For 2008 - 2009, people under 50 can contribute up to $5,000 and those age 50 or older can contribute up to $6,000. After 2009, the contribution limit will be adjusted annually for inflation.
Catch Up Contributions for People 50 and Older
People 50 and older before the end of the year can make additional contributions above the new maximum limits, of $1,000 per year.
Withdrawals
The IRS allows distributions any time after age 59 1/2, but must start by April 1st following the year in which the participant reaches age 70 1/2. However, there is no required distribution for 2009.
There is a 10% IRS penalty for withdrawing all or part of the account before age 59 1/2, with some exceptions.
View retirement CD interest rates.
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Roth
A Roth IRA is an individual retirement account to which participants are able to make annual non-deductible contributions. Unlike a Traditional IRA in which your earnings are tax-deferred, Roth IRA earnings can be tax-free. With a Roth IRA, unlike a Traditional IRA, contributions can be made even after you have reached age 70 1/2, provided you have earned income. (See special rules for Spousal IRAs.)
Contribution Limits
As with Traditional IRAs, the amount qualified Roth IRA owners can contribute annually will be gradually increased. Qualified persons may contribute the maximum amount, or 100% of their earned compensation and alimony, whichever is less. Eligibility is based on Adjusted Gross Income (AGI). (See special rules for Spousal IRAs.)
Participation in an employer sponsored retirement plan such as a 401(k) does not affect your ability to contribute to a Roth IRA, provided you meet the income guidelines. Single filers or married couples filing jointly with a modified adjusted gross income that does not exceed $100,000 may convert a Traditional IRA to a Roth IRA. Any portion of the converted amount attributable to deductible contributions and earnings must be included as taxable income. The entire taxable amount of the conversion must be included as income for the year the conversion is made.
Withdrawals
Qualified distributions may be made at any time, tax and penalty free. Non-qualified distributions may be taxable and subject to an IRS 10% early distributions penalty. Withdrawals will be taxed only on the amount withdrawn each year, on which taxes have not previously been paid. Remaining funds continue to accumulate tax-deferred, and possibly tax-free, earnings. View retirement CD interest rates.
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Coverdell Education Savings Account
The Coverdell Education Savings Account is a tax-advantaged savings account created to help fund qualified education expenses. The types of qualified expenses include both public and private elementary and high schools. Contributions are non-deductible, earnings are tax-deferred and distributions are tax free if used to pay for the account beneficiary’s qualified educational expenses.
Contribution Limits
Anyone — whether related to the account beneficiary or not — may contribute toward the combined maximum of $2,000 to a child’s Coverdell Savings Account, provided their earned income is less than $190,000 (for married couples filing jointly) or $95,000 (individual filers). Proportionately smaller contributions are permitted for couples earning between $190,000 and $220,000 and for individuals earning between $95,000 and $110,000. Contributing to a Coverdell Education Savings Account does not affect your ability to contribute to a Roth or T-IRA. Rollovers from a Roth or T-IRA are not allowed. A Coverdell Savings Account must have one responsible individual, a parent or legal guardian of the child/beneficiary, to oversee the account. This person decides when funds will be withdrawn and if and when funds will be rolled over to the Coverdell Savings Account of another family member.
Key Features of Coverdell Education Savings Accounts
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Contributions are non-deductible
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Qualified distributions are tax-free
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Contributions must stop at beneficiary’s 18th birthday unless they are a special needs child
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Funds must be disbursed or rolled over by beneficiary’s 30th birthday unless they are a special needs child
Withdrawals
Distributions may be made at any time, tax and penalty free as long as funds are used to pay for qualified education expenses for the account’s designated beneficiary. Non-qualified distributions may be taxable and subject to an IRS penalty. View retirement CD interest rates.
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Contact us for more information.
Terms from 9 months to five years
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