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IRAs

• Traditional, ROTH, SEP accounts available
• 182 day, 18 month, 36 month terms - Certificate Accounts
• $250.00 minimum deposit to open – Must maintain minimum balance to earn Annual Percentage Yield
• Early withdrawal penalty may apply for individuals under age 59 1/2
• Once you reach 59 ½ or older, funds are available for withdrawal regardless of maturity date
• Deposits of $1.00 or more are allowed anytime during the term
• No Commission or Maintenance fees
• IRA INFORMATION
• TRADITIONAL IRA Deductibility
• ROTH Contribution Eligibility
• IRA/ROTH Contribution Limits
• TRADITIONAL IRA Required Distributions
• ROTH Distributions
• SEPs (SIMPLIFIED EMPLOYEE PENSION PLANS)
• Definitions

Note – You must reside within Delaware County or the contiguous counties (Franklin, Knox, Licking, Marion, Morrow and Union) to open an account with Fidelity Federal Savings & Loan

When you open an account with Fidelity Federal Savings & Loan, we will ask you for your name, address, date of birth, taxpayer identification number and other information that will allow us to identify you. We will also ask to see your driver’s license or other identifying documents. We will let you know if additional information is required.


IRA INFORMATION
Congress created Individual Retirement Arrangements (IRAs) in 1974 to encourage individuals to save money for their retirement. The Traditional IRA has gone thru several changes over the years but still offers retirement savings advantages for many individuals. The ROTH IRA became available in 1998. The ROTH IRA offers individuals additional options for their retirement savings programs including the potential for tax-free earnings.

TRADITIONAL IRA
Annual contributions to a Traditional IRA may be tax deductible depending on the Modified Adjusted Gross Income (MAGI) of the individual and whether or not they are covered by an employer’s retirement plan. Earnings that are paid on Traditional IRA accounts are tax-deferred until withdrawn. At the time that earnings are withdrawn, they are taxed at the ordinary tax rate of the individual. Individuals may contribute up to 100% of earned income or the maximum allowed, whichever is less (See IRA Contribution Limits). Regular IRA contributions are prohibited once an individual attains the age of 70.5 years or older. An individual may begin withdrawing funds from their IRA at age 59.5. A 10% additional tax generally applies if you withdraw or use IRA assets before you are age 59½. An IRA owner must begin withdrawing funds from their IRA at age 70.5. Funds withdrawn are taxable to the IRA owner.

ROTH IRAS 
A Roth IRA is an individual retirement account that 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.

ROTH IRA DISTRIBUTIONS
A qualified distribution is any payment or distribution from your Roth IRA that meets the following requirements.

1. It is made after the 5-year period beginning with the first taxable year for which a contribution was made to a Roth IRA set up for your benefit, and
2. The payment or distribution is:
   1. Made on or after the date you reach age 59½,
   2. Made because you are disabled,
   3. Made to a beneficiary or to your estate after your death, or
   4. One that meets the requirements listed under First Time Home Purchase (up to a $10,000 lifetime limit).

IRA/ROTH CONTRIBUTION LIMITS
Traditional IRA contribution limits: Individuals may contribute up to 100% of earned income or the maximum allowed, whichever is less.(see chart below) Regular IRA contributions are prohibited once an individual attains the age of 70.5 years or older. No regular contribution can be made during the year that an individual will attain the age of 70.5.

Roth Contributions Limits: Individuals may contribute up to 100% of earned income or the maximum allowed, whichever is less.(see chart below) Regular contributions can be made past the 70.5 year if income guidelines are met.

Catchup Contributions Limits: Individuals age 50 and over may contribute a “catch-up” contribution in addition to the standard contribution limit, if income guidelines are met.
The contribution limit is an aggregate limit per year for Traditional and Roth IRAs.

CONTRIBUTION TABLE

TAX YEAR	STANDARD LIMIT	CATCH-UP AMOUNT	TOTAL FOR AGE 50 & OVER
2002-2004	$3,000	$500	$3,500
2005	$4,000	$500	$4,500
2006-2007	$4,000	$1,000	$5,000
2008	$5,000	$1,000	$6,000
2009 and after	$5,000 + *COLA	$1,000	$6,000 + *COLA

 *COLA = Cost of Living Adjustment

SIMPLIFIED EMPLOYEE PENSION PLANS – SEPs
A SEP is a business retirement plan established and administered by an employer. Each year, the employer can contribute a certain percentage of each eligible employee’s compensation directly to the employee’s Traditional IRA. Contributions are discretionary each year and may range from 0 to 25% of compensation. The contribution percentage must be the same for the employer and all eligible employees. Funds are deposited into Traditional IRA Accounts and are subject to the standard IRA rules and regulations. The contributions plus earnings are taxable to the IRA account owner upon withdrawal and may be subject to a 10% penalty if withdrawn prior to reaching age 59.5.

For additional information regarding SEP IRAs please consult your tax advisor, legal counsel and/or your financial advisor.

DEFINITIONS