Traditional IRA

Traditional IRAs

For a secure future

Would you like to save on your tax bill this year, while also putting money away for retirement?  A Traditional IRA may be the best option for you. Traditional IRAs may be deposited in any CD term of 4 years or less. See rates here.

Traditional IRAs offer two large incentives to encourage retirement savings. 

  1. Traditional IRA contributions may be tax-deductible on an IRA holder's tax return. Consult your tax advisor to find out if you qualify for the deduction.
  2. Earnings on a Traditional IRA are not taxed until the IRA holder takes the money out. Traditional IRA holders are not required to withdraw the funds until they reach the age of 70½.

 Are you eligible?

In order to contribute to a Traditional IRA, the contributor (or spouse if married and filing a joint return) must:

  • Have earned income equal or greater than the contribution amount. 
  • Be 70½ years of age or younger.
  • Only contribute the maximum allowed to both a Traditional IRA or Roth IRA. If contributions are made to both a Traditional and Roth IRA, the maximum contribution to the Traditional is reduced by the amount contributed to the Roth IRA. 

Your Modified Adjusted Gross Income (MAGI) and your participation in an employer-sponsored retirement (QRP) will affect your deductibility. Please refer to the income deduction limits below:

2015 Traditional IRA Deduction MAGI Ranges

Participant 2015
Single active participant:

Less than $61,000 – full deduction

$61,000 - $71,000 – partial deduction

More than $71,000 – no deduction

Married active participant filing joint income tax return:

Less than $98,000 – full deduction

$98,000 - $118,000 – partial deduction

More than $118,000 – no deduction

Married active participant filing separate income tax return:

Less than $10,000 – partial deduction

More than $10,000 – no deduction

Married, joint (not active participant but spouse is):

Less than $183,000 – full deduction

$183,000 - $193,000 – partial deduction

More than $193,000 – no deduction

2016 Traditional IRA Deduction MAGI Ranges

Participant 2016
Single active participant:

Less than $61,000 – full deduction

$61,000 - $71,000 – partial deduction

More than $71,000 – no deduction

Married active participant filing joint income tax return:

Less than $98,000 – full deduction

$98,000 - $118,000 – partial deduction

More than $118,000 – no deduction

Married active participant filing separate income tax return:

Less than $10,000 – partial deduction

More than $10,000 – no deduction

Married, joint (not active participant but spouse is):

Less than $184,000 – full deduction

$184,000 - $194,000 – partial deduction

More than $194,000 – no deduction


Contribution amounts and catch-up contribution amounts will increase annually as follows:

Tax Year Contribution Limit Catch-Up Limit If Age 50 Or Older Total Contribution If Age 50 Or Older
2015 $5,500 $1,000 $6,500
2016 $5,500 $1,000 $6,500
Read Important Information About Earnings and Penalties.

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