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Roth IRA
A Roth IRA is an individual savings plan that you establish to save for your retirement.

Roth IRA
Roth IRA
A Roth IRA is an individual savings plan that you establish to save for your retirement. A Roth IRA allows only nondeductible contributions, but features tax-free withdrawals for certain distribution reasons after a five-year holding period. The term “tax free” means free from federal income taxes.

Term
Minimum Balance
to Earn Interest
Interest Rate
APY
3 Month IRA CD
$1,000
0.20%
0.20%
6 Month IRA CD
$1,000
0.40%
0.40%
12 Month IRA CD
$1,000
0.65%
0.65%
24 Month IRA CD
$1,000
1.00%
1.01%
36 Month IRA CD
$1,000
1.13%
1.14%
48 Month IRA CD
$1,000
1.30%
1.31%
60 Month IRA CD
$1,000
1.50%
1.51%
IRA Savings Accounts (Minimum Opening Balance is $100)
IRA Savings
$100
0.25%
0.25%
Rates are current as of Apr 23, 2014.
Annual Percentage Yield

The minimum balance to open a Roth IRA CD is $1,000. The minimum balance to open a Roth IRA Savings Account is $100. You must maintain the minimum balance indicated in the tables above to earn the disclosed APY. A penalty may be imposed for early withdrawal. The minimum balance to avoid being charged a monthly maintenance fee is $100. The interest rates and APY may change after the account is opened for all interest bearing accounts except CDs. Calculations of the APY assume interest is credited to the account monthly. Fees could reduce earnings on accounts. Refer to the appropriate Fee Schedule and Terms and Conditions.
*The maximum annual contribution to a Roth IRA cannot exceed the limits in the table below.
Maximum Annual Contribution
Tax Year
Under Age 50
Age 50 & Older
2013
$5,500
$6,500
2014
$5,500
$6,500
A Roth IRA differs from a Traditional IRA in several ways:
You cannot make a Roth IRA contribution if your adjusted gross income (AGI) reaches the following limits:
Roth IRA MAGI Thresholds
Filing
Status
Tax
Year
Full Contribution
Partial Contribution
No Contribution
Single
2013
≤$112,000
Between
$112,000 and $127,000
≥$127,000
2014
≤$114,000
Between
$114,000 and $129,000
≥$129,000
Married, Joint
2013
≤$178,000
Between
$178,000 and $188,000
≥$188,000
2014
≤$181,000
Between
$181,000 and $191,000
≥$191,000
Married, Separate
2013
N/A
<$10,000
≥$10,000
2014
N/A
<$10,000
≥$10,000
Contributions to a Roth IRA are not tax deductible.
After your Roth IRA has been in existence for at least 5 years, the following distributions from the account are tax-free:
  • Distributions made after you turn 59½.
  • Distributions of up to $10,000 (lifetime limit) that are used for the first-time purchase of a home.
  • Distributions made upon your death or disability.
You may contribute to a Roth IRA after age 70½ if you have earned income.
You are not required to take annual distributions from a Roth IRA when you turn 70½.
A Roth IRA might be right for you if:
Your modified adjusted gross income (MAGI) is less than that shown in the table above.
You have earned income and you want to continue to make contributions after age 70½ while working.
You don't want to take mandatory withdrawals after age 70½.
You prefer to have tax-exempt funds available at retirement.
You do not have another IRA or you want to split contributions between a Traditional IRA and a Roth IRA (the combined maximum allowed for the Traditional IRA and a Roth IRA is limited to $5,500 per year, or $6,500 for age 50 and over).
TO LEARN MORE, CALL 800.837.4214
Tax-exempt retirement income
Contributions to a Roth IRA are not deductible, but withdrawals are generally tax-exempt if:
You don't begin withdrawals until at least five years after you establish the Roth.
You are younger than 59½, but you use the withdrawn funds for a first-home purchase (withdrawals for this purpose are limited to a lifetime cap of $10,000).* In all cases, a Roth IRA must be held for at least five years to qualify for the federal tax exemption.
You become disabled or die.
Withdrawals, penalties and fees for IRAs
Withdrawals of earnings prior to meeting the plan requirements (five years and age 59½ or first-time home purchase or disability or death) may be subject to ordinary income tax and 10% federal additional tax as well as possible state taxes, unless an IRS exemption is allowed.
Bank penalties may apply for withdrawals from time deposits before maturity.
Converting an existing IRA to a Roth IRA
If you already have a Traditional IRA but have determined that the Roth IRA is more advantageous, you can direct future IRA contributions to a Roth IRA. You can convert (roll over) your existing Traditional IRA to a Roth IRA as long as your modified adjusted gross income (MAGI) is no more than $100,000 (this threshold applies whether you are a single or a joint taxpayer) and married individuals must file a joint tax return.
Important Note:
Converting a Traditional IRA to a Roth IRA is not a tax-free "rollover." A distribution of funds from a Traditional IRA is a taxable distribution. The decision to convert may depend on a number of factors, including whether you are willing to pay the taxes now in return for potentially receiving more after-tax income when you withdraw funds from the Roth IRA later. Before you convert, be sure that you are in fact eligible and that your MAGI will not exceed the $100,000 limit. The amount of your distribution may be subject to tax penalties, especially if you do not roll over the entire amount of the distribution into a Roth IRA. We suggest you see your tax advisor before making your final decision.

*Withdrawals from IRAs before age 59½ may be subject to a 10% federal additional tax and possible state tax. In addition, withdrawals from Fixed Term and Variable Rate IRAs before the maturity date may also be subject to a bank early withdrawal penalty.

This communication is for information purposes only and is not intended nor should be regarded or construed as legal advice, tax advice, an offer to sell or buy any financial product, an official confirmation of any transaction, or as an official statement of TAB Bank Inc. All information is subject to change without notice. For more information, please consult the IRS website at www.irs.gov or your own tax advisor or attorney with regard to your individual situation