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It's never too early to start saving for your retirement. ECU offers several IRA options and can find the right one to fit your retirement goals! Consider an IRA, even if you are currently participating in your employer's retirement plan.
NOTICE OF WITHHOLDING
ROTH IRA CONVERSIONS: Should you pay tax now or later?
KEEP YOUR BENEFICIARIES UP TO DATE
TRADITIONAL IRA
You are eligible to contribute to a Traditional IRA if you are younger than 70 1/2 for the entire tax year and you or your spouse has earned income.
This IRA allows you to defer taxes on earnings until withdrawn.
Contributions may be tax deductible in the year in which you make them.
ROTH IRA
Regardless of age, you are eligible to contribute to a Roth IRA if you or your spouse has earned income and your modified adjusted gross income (MAG) does not exceed a certain limit.
This IRA allows only non-deductible contributions, but distributions after a five-year waiting period can be tax free.
COVERDELL EDUCATION SAVINGS ACCOUNT (CESA)
This account is a good tool to use for paying qualified education expenses.
Contributions can be made by any interested party, but are not tax deductible; however, distributions used to pay qualified education expenses are federal income tax free and penalty free.
YOUR RETIREMENT PLAN
If you are not at your last job, what should you do with your employee-sponsored retirement plan?
You have several options, including:
1. Taking the money in a lump sum - carefully consider the tax consequences.
2. Leaving the money in your plan, if the plan permits.
3. Moving the money into a new plan, if the new plan allows such transfers.
4. Rolling over retirement plans into an IRA.
Review your choices carefully.
You should review your retirement plan distribution options with your tax professional. You may be making one of the most important financial decisions of your life - so make a good one. Our IRA specialists will be pleased to help you request your IRA rollover. Call us today!
NOTICE OF WITHHOLDING
If federal income taxes are currently being withheld from the Individual Retirement Account (IRA) payments you are receiving, but you do not wish to have taxes withheld, please notify Educators Credit Union. Please note, if you elect not to have withholding apply to your IRA payment or if you do not have enough federal income tax withheld from your IRA payments, you may be responsible for payment of estimated tax. You may incur penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient.
If federal income taxes are not being withheld from your IRA payments because you elected not to have withholding apply, but you wish to change that election and have federal income taxes withheld, please notify an IRA Specialist at Educators Credit Union.
ROTH IRA CONVERSIONS: Should you pay tax now or later?
As of January 1, 2010, you can convert your traditional IRA to a Roth IRA regardless of your income or tax filing status. Make sure to consider the following before you decide when to recognize any conversion income: special tax option for 2010 conversions, uncertainty of future rates, how the taxable income from the traditional IRA might effect your deductions, and the tax rate for 2010.
We recommend you consult a tax or financial advisor about your individual situation.
MAKE SURE YOUR BENEFICIARIES ARE UP TO DATE
Have you updated your beneficiaries lately? As time goes by it is easy to forget to update your beneficiaries. There are many reasons why beneficiaries need to be updated. Death and divorce are the most common. Keep your beneficiaries up to date so that your money goes to the correct person, not the state.
To update your beneficiaries, come in and speak with an account representative.
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IRAs 