Traditional IRA

A Traditional IRA allows you to save for specific retirement goals, while providing long-term, tax-advantaged savings opportunities to help you make the most of your financial future.

Anyone under age 70 1/2 who has earned income (or is filing jointly with a spouse who has earned income) may contribute to a Traditional IRA.

Benefits & Highlights

Immediate tax benefits – contributions may be tax deductible and earnings are tax deferred until removed from the IRA*
No minimum yearly contribution
Dividends are compounded daily and posted monthly
IRAs are federally insured up to $250,000 by the National Credit Union Share Insurance Fund
Make withdrawals penalty-free after age 59 1/2

Contribution Limits
You can make the following maximum contributions to a Traditional or a Roth IRA:

2010 and 2011
$5,000 under age 50	$6,000 over age 50

Make withdrawals penalty-free** for any of the following reasons:

Age 59 1/2
First-time home purchase (lifetime limit is $10,000 per person)
Disability
Qualified higher education expenses
Qualifying medical expenses exceeding 7.5% of adjusted gross income
Payment to beneficiaries upon the owner's death
Payment of health insurance premiums while unemployed for 12 weeks or longer.

IRA Phase-Out Range and Limits
IRA Type	2010 Limit/Levels	2011 Limit/Levels	Change Summary
Traditional IRA (S = Single and Head of Household) (M = Married)	Contribution Limit: $5,000 Deduction Income Limits: (S) $56,000 and $66,000 (M*) $89,000/$167,000 to $109,000/$177,000	Contribution Limit: $5,000 Deduction Income Limits: (S) $56,000 and $66,000 (M) $90,000/$110,000 to $169,000/$179,000	Marginal change to phase-out income limits
Roth IRA	Contribution Limit: $5,000 Eligible income phase-out range: (S) $105,000 to $120,000 (M*) $167,000 to $177,000	Contribution Limit: $5,000 Eligible income phase-out range: (S) $107,000 to $122,000 (M) $169,000 to $179,000	Marginal change to eligible income limits

IRA Phase-Out Range and Limits

IRA Type

2010 Limit/Levels

2011 Limit/Levels

Change Summary

Traditional IRA
(S = Single and Head of Household)
(M = Married)

Contribution Limit: $5,000

Deduction Income Limits:
(S) $56,000 and $66,000
(M*) $89,000/$167,000 to $109,000/$177,000

Contribution Limit: $5,000

Deduction Income Limits:
(S) $56,000 and $66,000
(M) $90,000/$110,000 to $169,000/$179,000

Marginal change to phase-out income limits

Roth IRA

Contribution Limit: $5,000

Eligible income phase-out range:
(S) $105,000 to $120,000
(M*) $167,000 to $177,000

Contribution Limit: $5,000

Eligible income phase-out range:
(S) $107,000 to $122,000
(M) $169,000 to $179,000

Marginal change to eligible income limits

* Married filing jointly

Please note, when you're ready to tap into a Traditional IRA, the money you withdraw is considered regular income, so you'll owe tax on the earnings at your current rate. If you've deducted your contributions, you'll owe tax on that part of your withdrawal as well, so the amount you have available to spend is reduced by whatever you owe in tax.

*Be sure to consult your tax advisor regarding how various IRAs relate to your tax situation.
** Early withdrawal penalties from certificates will apply.

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Traditional IRA