Individual Retirement Accounts
- Invested in Pinnacle Bank Certificates of Deposit or Money Market
- Contributions may be tax deductible – please consult your tax advisor
Options include:
- Traditional IRA – interest earned tax-deferred
- Roth IRA – interest earned non-taxable
Traditional IRAs
An interest-bearing, tax-deferred account for the purpose of saving money for retirement. IRAs may be CDs with certain restrictions and limitations, including a minimum amount of at least $500; Pinnacle Bank offers Traditional, Roth and Educational IRA’s.
Features
- Earns interest
- Amount withdrawn is taxed at the time of withdrawal you may be in a lower tax bracket at this time
- Must begin withdrawing at age 70 ½
- Non-working spouse can deposit up to $4,000 annually
- Pays interest quarterly, semi-annually or at maturity
- Automatically renewable
- Interest may be paid by ACH, compounded, or deposited into the customer’s existing account
- Annual contribution limits apply
Benefits
- Retirement Savings/Planning
- Amount withdrawn can be taxed at that time and customer may be in a lower tax bracket at that time
- IRAs from other institutions may be transferred here
- Company retirement rollovers/401Ks may be deposited as IRAs
Roth IRAs
An interest-bearing account for the purpose of saving money for retirement. IRAs may be CDs with a minimum balance of $500.
Features
- May be withdrawn at 59 ½ years of age without penalty
- Withdrawals are tax-free
- Pays interest quarterly, semi-annually or at maturity
- Automatically renewable
- Interest may be paid by ACH, compounded, or deposited into the customer’s existing account
- Annual contribution limits apply*
- Contributions are nondeductible, withdrawals are tax-free
- Good for those who will be in a higher tax bracket when they retire
*Contribution limits are set by the IRS
Benefits
- Retirement Savings/Planning
- Amount withdrawn can be (on Traditional IRAs) taxed at that time and customer may be in a lower tax bracket at that time (Roth IRA is not taxed at withdrawal)
- IRAs from other institutions may be transferred here
- Company retirement rollovers/401Ks may be deposited as IRAs
*Penalties apply for early withdrawal
