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IRAs

Set goals for your financial future.

An Individual Retirement Account (IRA) is a great way to save for retirement and ensure a healthy financial retirement—especially if you are not eligible to participate in an employer’s plan or if you want additional ways to save that offer potential tax advantages.

There are two types of IRA—Roth and Traditional. LOC offers both. The best option for you depends on your income, your goals and other types of retirement accounts you currently have access to.

Roth vs Traditional

The below chart is a high-level comparison of a Roth and Traditional IRA.  We recommend you speak with a knowledgeable professional to help determine which IRA is best for you and how you should fund it.  For specific tax details, consult your tax advisor.

 

Roth IRA

Traditional IRA

Who can contribute?

Individuals, and/or spouses if they file jointly at any age, whose adjusted gross income for 2016 is below $132,000 (single) or $194,000 (joint) and report earned income.

Individuals, and/or spouses if they file jointly, are under the age of 70 ½ and report earned income.

How much can contribute

Up to $5,500 or 100% of earned income, whichever is less.

If you are 50 or older, you can make an additional contribution of $1,000 for a total of $6,500.

Allowed contributions begin to phase out at $117,000 (single) or $184,000 (joint) for 2016

Up to $5,500 or 100% of earned income, whichever is less.

If you are 50 or older, you can make an additional contribution of $1,000 for a total of $6,500.

Total combined contribution to a Traditional and Roth IRA cannot exceed $5,500 (or $6,500 if age 50 or older)

Tax advantages

Possible tax-free growth investment.

No tax deduction is available as contributions are made with after-tax dollars.

Tax-deferred growth and possible tax deduction for your contribution. 

Consult your tax advisor.

When can I access my funds?

You may withdraw your contributions at any time without penalty as long as the account has been opened for five years.

You can begin to withdraw earnings at age 59 ½.

Any withdrawals made on earnings prior to age 59 ½ are subject to income taxes as well as a 10% penalty.

You can begin withdrawals at age 59 ½. These withdrawals will be taxed as regular income.

Any withdrawals prior to age 59 ½ are subject to income taxes as well as a 10% penalty.

When must I start taking distributions?

At this time, there are no distribution requirements on a Roth IRA.

Distributions must begin by age 70 ½. This is known as required minimum distribution.

How to Fund

At LOC, you have options to fund your IRA:

Looking for more options?

Check out our wealth management services.

Learn more 

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