Individual Retirement Accounts

IRA Savings

With a $50.00 initial deposit you can set up a Traditional IRA and/or Roth IRA. You can then make deposits throughout the year as your budget allows via Payroll Deduction, Direct Deposit, mail, or in person. Once your balance reaches $1,000 you can transfer funds to a high-yield IRA Savings Certificate.

• No annual maintenance fees
• Dividends calculated daily and paid quarterly
• $50 initial deposit

IRA Certificates

Lock in a high yield for a specified investment term with our IRA Share Certificates, Traditional IRA Share Certificates, and Roth IRA Share Certificates. The longer the term, the higher the return. Minimum deposits start at $1,000.
No annual maintenance fees
$1,000 Minimum balance requirement
Dividends calculated daily and paid monthly
Terms range from 3 months to 24 months
Which IRA Plan is Best for You?
If you’re thinking of opening an IRA, it’s best to know which IRA plan is best for your retirement strategy before you open it. Silverado offers three types of IRA plans:
Traditional IRA
Roth IRA
Educational IRA
* You are advised to seek advice from your own tax professional and attorney.

Traditional IRA

The Traditional IRA may be most beneficial to those who can fully deduct their contributions from their taxes. For example, contributions may be fully deductible if you are single, or married filing jointly and have no retirement plan in place at work. However, if you already have a retirement plan at work, your contributions to a Traditional IRA may only be partially deductible. Also, the amount of your Adjusted Gross Income (AGI) will determine whether your IRA contributions are fully or partially deductible.

Who can contribute?

Anyone under age 70 ½ with income from compensation.

How much can I contribute?

Total combined contributions to Roth and Traditional IRAs up to $5,500/year or 100% of compensation, whichever is less. ($6,500 if you are age 50 or older).

Who can make Deductible Contributions?

• A single person who does not participate in an employer retirement plan can deduct all contributions, regardless of income.
• A single person who participates in an employer retirement plan and has MAGI* of $62,000 or less can deduct all contributions. The $5,500 maximum deduction is phased out between 62,000-$72,000+ of MAGI*.
• A married couple where neither person participates in an employer retirement plan can deduct all contributions, regardless of income.
• A married person who participates in an employer retirement plan can deduct all IRA contributions if they file a joint tax return showing MAGI* of $99,000 or less. The $5,500 maximum deduction is phased out between $99,000-$119,000+ of joint MAGI*.
• A married person who does not participate in an employer retirement plan who is married to someone who is in an employer retirement plan can deduct all IRA contributions if the person files a tax return showing MAGI* of $186,000 or less. The $5,500 maximum deduction is phased out between $186,000-$196,000+ of MAGI*.

What are the Tax Advantages?

Earnings compound without tax until withdrawn, usually out earning taxable, non-IRA investments. Contributions may be tax-deductible

Can I Withdraw From The Account?

Withdraw penalty-free for:

• Qualified educational expenses
• First-time home purchase
• At age 59 ½
• If you become disabled
• Qualifying medical expenses (withdrawal of earnings and deductible contributions results in taxable income)
• Payment to beneficiaries at owner’s death
• Health insurance premiums while unemployed
• IRS Levy

* You are advised to seek advice from your own tax professional and attorney.

Roth IRA

If you need a retirement plan with more flexibility than the Traditional IRA, the Roth IRA may be what you need. Though you generally need to wait five years, the Roth IRA allows you to withdraw funds (contributions only, not interest earned) to make a down-payment on a home, pay college tuition, pay for expenses related to a disability, and more. Also, because withdrawals from a Roth IRA after age 59 ½ are not usually taxed, the Roth IRA is fast becoming the more popular choice for many taxpayers.
This new IRA account allows up to $5,500 non-deductible deposits with all earnings being free of federal income tax if the money saved is on deposit for five years or more and used for a qualified purpose.

Qualified distribution reasons include:

• A first home (up to $10,000)
• Age 59 ½
• Disability
• Payment to beneficiaries at owner’s death

Who can contribute?

• Married couples filing a joint tax return with MAGI* up to $186,000
• Single tax filers with MAGI* up to $118,000
• Couples and single tax filers with higher incomes may be eligible for reduced contributions.

How much can I contribute?

Total combined contributions to Roth and traditional IRAs up to $5,500/year of 100% of compensation, whichever is less. ($6,500 if you are age 50 or older).

Who can make deductible contributions?

No one can deduct contributions.

What are the tax advantages?

• Contributions can be withdrawn tax- and penalty-free anytime.
• Earnings can be withdrawn tax-and penalty-free for any of these reasons after the account has been open five tax years: after age 59 ½, if you become disabled, or for first-time home purchase.
• Withdraw earnings penalty-free for the same reasons as those for penalty-free withdrawals from traditional IRAs (withdrawal is subject to taxes).

Can I withdraw from the account?

• Earnings tax-free if account is open for five years and withdrawn for qualified reason.
• Not required to start withdrawals at age 70 ½

* You are advised to seek advice from your own tax professional and attorney.

Educational IRA

The new Education IRA serves to help parents and others save for children’s education. Contributions are not tax deductible, but the earnings grow tax deferred. Distributions used to pay for qualified education expenses are tax-free.

Who can contribute?

Contributions to benefit a child under age 18 may be made by:

• Couples who file a joint tax return and have joint MAGI* of $220,000 or below.
• Persons filing an individual tax return with MAGI* of $110,000 or below.
• If income exceeds the limits, a contribution cannot be made for that year.
• Contributions not allowed in any year that a contribution is made to a state tuition program for the child.

How much can I contribute?

No more than $2,000 total each year for all accounts opened on the child’s behalf.

Who can made deductible contributions?

No one can deduct contributions.

What are the tax advantages?

Withdrawals for qualified higher-education expenses are tax-free.

Can I withdraw from the account?

• Tax-and penalty-free withdrawals only for qualified expenses (other withdrawal of earnings subject to tax and penalty).
• Funds can be transferred from one child’s account to another child in the family

* You are advised to seek advice from your own tax professional and attorney.

Simplified Employee Pension Plan IRA

A retirement solution for the self employed

If you’re a small business owner or a self-employed entrepreneur or freelancer, a SEP IRA is the perfect way for you to start saving for your future retirement while enjoying tax benefits today.

SEP stands for “Simplified Employee Pension” plan. Basically, a SEP IRA is a traditional IRA for the self-employed. SEP IRAs, like traditional IRAs, allow your earnings to grow tax-deferred. You can invest up to 25% of your compensation, up to $54,000 per year, in a SEP IRA account.

Our IRA products are low-risk and are NCUA-insured (separately from your other non-IRA deposit accounts) so your retirement savings are secure. Often, there are tax advantages* with IRAs, so it helps to understand the different types of IRAs and to consult with your tax advisor.

This information is designed to provide general information concerning IRA accounts. It is not intended to provide legal advice nor to be a detailed explanation of how this information may apply to your individual circumstances. For specific information, you are encouraged to consult your tax or legal professional, IRS Publication 590 for Individual Retirement Accounts, and/or the IRS website at www.irs.gov.

* You are advised to seek advice from your own tax professional and attorney.

Health Savings Account

Health Savings Accounts (HSA) are another way to pay for the rising cost of medical care. Our HSA Checking Account provides peace of mind by allowing you to save money for your future medical expenses. Your deductible contributions to HSA Checking accounts are never taxed as long as they are used for medical expenses. Please consult your tax advisor to see if you qualify for a Health Savings Account and for the tax benefits related to this account.
Your Health Savings Account balance rolls over from year to year, allowing it to grow for future medical expenses. You can access the funds with a specific debit card at the time a medical expense is incurred.

Who can have HSA Checking?

Any adult may contribute to HSA Checking if they:

• Have coverage under an HSA-qualified high-deductible health plan (HDHP)
• Have no other first-dollar medical coverage (Other types of insurance such as specific injury insurance and accident, disability, dental care, vision care and long-term care insurance are permitted.)
• Are not enrolled in Medicare
• Cannot be claimed as a dependent on someone else’s tax return

Is HSA Checking right for you?

The idea behind HSAs is that consumers will make better health care choices by spending their own money than they might with traditional insurance plans. To know if HSA Checking is right for you, decide if your deductible, combined with your minimum out-of-pocket requirement, results in a good value.
HSAs work well for people who are generally healthy and seldom need a doctor. The account is ideal for preventive health care expenses such as orthodontia, mammograms, eye exams and glasses, dental fees, etc. You can also save money because HSAs may provide a tax benefit.*

How much should I contribute?

The contribution limit in the first year is not reduced due to partial-year eligibility. A testing period to determine eligibility applies, beginning with the last month of the contribution year and ending on the last day of the twelfth month following. For more details regarding the testing period, consult your current health insurance provider. Contributions can be made until April 15 of the following year.
With the rising cost of health care, saving now through a HSA Checking may be the right move for you.