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Features and Benefits
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Rollover IRA
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Traditional IRA
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Roth IRA
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SEP IRA
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Description
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Appeals to eligible investors who:
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Want to move retirement funds from an employer-sponsored plan to an IRA CD
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Anticipate being in a lower tax bracket in retirement, or
Meet the criteria for making tax-deductible contributions and are most interested in a current tax deduction
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Expect their tax bracket to be the same or higher in retirement
Are most interested in passing IRA assets to their heirs
May not need their IRA assets to cover living expenses during retirement
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Are self-employed individuals or business owners with employees.
Prefer a plan that is easy to set up and maintain
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Minimum balance
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$500.00
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$500.00
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$500.00
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$500.00
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Online Access
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Account access to balances, and activity through AuburnBank’s online service
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Account access to balances, and activity through AuburnBank’s online service
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Account access to balances, and activity through AuburnBank’s online service
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Account access to balances, and activity through AuburnBank’s online Service
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Contributions
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Annual Maximum Contribution
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To preserve status as a "conduit" IRA, no annual contribution allowed
Otherwise, traditional IRA contribution limits apply
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Lesser of 100 percent of your earned income, or:
In 2013, the contribution limit is $5,500
Aggregated with other IRA accounts (except Education Savings Accounts)
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Lesser of 100 percent of your earned income, or:
In 2013, the contribution limit is $5,500
Aggregated with other IRA accounts (except Education Savings Accounts)
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Employer contributions only
Total contributions to each employee's IRA cannot exceed the lesser of $51,000 for 2013 (and subject to cost-of-living adjustments for later years) or 25% of gross income
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Catch-Up Provisions (for individuals age 50 and older)
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No, if conduit IRA1
Otherwise, same as traditional IRA.
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$1,000
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$1,000
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No
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Contribution Deadline
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April 15 of the following year, the tax filing deadline.
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April 15 of the following year, the tax filing deadline.
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April 15 of the following year, the tax filing deadline.
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The company's tax filing deadline, plus extensions.
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Restrictions on Contributions
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No contributions allowed for conduit IRAs
Otherwise, same as traditional IRA
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Contributions can only be made prior to the year in which the IRA owner turns 70 ½
Must have earned income
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No age requirements
Phased out for taxpayers with annual Adjusted Gross Income over $112,000 (single) and $178,000 (joint)
Must have earned income
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Employer contributions only
Some employees may be excluded from this plan
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Deductible Contributions?
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Typically contains funds from another tax-advantaged plan (without additional contributions)
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Subject to income limits and participation in an employer-sponsored plan
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Contributions are not tax-deductible
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Contributions are tax-deductible for the business, up to 20% of modified net earnings (self-employed) or 25% of salary (employees)
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Withdrawals
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Taxation on Withdrawals
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Same as traditional IRA
Withdrawals are subject to current federal income taxes and a possible 10% penalty (if the participant is under age 59½)
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Earnings and deductible contributions are taxed as ordinary income
10% federal tax penalty before age 59 ½ unless due to death, disability, eligible medical expenses, certain unemployed individual's health insurance premiums, limited "first time" home purchase, qualified higher expenses or IRS levy.
No tax on non-deductible contributions
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Contributions may always be withdrawn tax- and penalty-free
Earnings are distributed tax-free and penalty free if held at least five years in the Roth IRA and either paid out after age 59 ½ or because of one of the following:
(1) Death
(2) Disability
(3) First home purchase
If earnings are taken earlier, they are subject to ordinary income tax and may be subject to a 10% penalty
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Same as traditional IRA
Withdrawals are subject to current federal income taxes and a possible 10% federal tax penalty (if the participant is under age 59½)
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Mandatory Distributions
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Same as traditional IRA
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Age 70 ½ or death
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None during lifetime
Beneficiary (except spouse) must begin at IRA owner's death
Same as traditional IRA
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Same as traditional IRA
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Fees and Investment Charges
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Set-up costs
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None
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None
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None
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None
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Annual Fee
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$0
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$0
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$0
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$0
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