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Traditional IRAs

Looking for a tax-deferred retirement plan? A Traditional IRA may be for you. With a Traditional IRA, interest earned as income is not taxable until the funds are withdrawn. Usually this occurs after retirement when the taxpayer is in a lower tax bracket. IRA earnings grow tax-deferred.

  • Contributions to a Traditional IRA can be tax deductible in the year they are made depending on the IRA holder's income level and participation in Employer Sponsored retirement plans.
  • Contributions can be made up until your tax deadline, generally April 15, for a prior year contribution.
  • Contributions can be the lesser of the annual contribution limit or 100% of earned income per participant and are allowed until the year in which the participant reaches the age of 70 ½.
  • Generally, Traditional IRA account holders are taxed on distributions in the year the distributions are taken.
  • The Traditional IRA account holder is required to begin taking distributions in the year in which they reach age 70½. Individuals can begin to withdraw without IRS penalty at age 59½. Please consult your tax advisor for more details.
  • Individuals who reach age 50 or older before the end of the taxable year may be eligible to contribute an additional $1,000 to a Traditional IRA as a "catch-up" contribution.

    Year  Annual Contribution
    Limit under age 50
    Annual Contribution
    Limit over age 50
    2012 $5,000 $6,000
    2013 $5,500 $6,500



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All accounts and services are subject to approval. IRA distributions may be subject to state taxation depending on the tax law of your state. Citizens Bank does not offer tax advice. Consult your tax advisor for IRA eligibility rules and your individual circumstances. Please refer to the Personal Deposit Account Agreement and Fees and Features Guide for fees and information. See a banker for details and FDIC insurance limitations. Fees may reduce earnings.