A Traditional IRA is a tax-deferred individual retirement account, or an individual retirement annuity, from which eligible investors may be able to obtain a tax deduction on their contributions.
You are eligible for the tax deduction if:
The Traditional IRA contribution limit from your earned income for the 2014 tax year is a maximum of $5,500 (or up to $6,500 if you’re age 50 or older).
You must be under age 70½ and have taxable compensation to be eligible to contribute to a Traditional IRA.
Withdrawals from a Traditional IRA after age 59½ are taxed at your ordinary income tax rate. However, if you withdraw money from a Traditional IRA before age 59½, you may pay a 10% early withdrawal penalty, as well as ordinary income tax.
The IRS may waive this penalty when distributions are used for:
Traditional IRA owners must begin taking minimum distributions no later than April 1 following the year they turn age 70½, or else they face a 50% IRS penalty tax on the amount they should have withdrawn.
Neither TIAA-CREF nor its affiliates offer tax advice. The tax information contained herein is not intended to be used, and cannot be used, by any taxpayer for the purpose of avoiding tax penalties. Taxpayers should seek advice from an independent tax advisor based on their own particular circumstances.
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Investment, insurance and annuity products are not FDIC insured, are not bank guaranteed, are not deposits, are not insured by any federal government agency, are not a condition to any banking service or activity and may lose value.
The tax information contained herein (including any attachments) is not intended to be used, and cannot be used, by any taxpayer for the purpose of avoiding any tax penalties that may be imposed on the taxpayer. It was written to support the promotion of the products and services addressed herein. Taxpayers should seek advice based on their own particular circumstances from an independent tax advisor.
In addition to the inherent risks associated with investing in securities, including the loss of principal, there may be fees associated with IRAs.
TIAA-CREF Individual & Institutional Services, LLC and Teachers Personal Investors Services, Inc., members FINRA, distribute securities products.
There are benefits to an IRA rollover.