Harris - Traditional IRA

Investments and Retirement Planning

The Traditional IRA

The Traditional IRA is an excellent method to save for retirement and possibly reduce current taxes.

Primary Benefits

	•	Deferred Taxes. Taxes on all earnings are deferred until the time of withdrawal. Your earnings stay in your account and continue to compound and reinvest, speeding up your account growth.
	•	Tax Deductible. All or some of your IRA contribution may be deductible from your current year's income taxes. If you and your spouse did not participate in an employer-sponsored retirement plan, you can deduct your entire contribution amount, regardless of your income. If you or your spouse were covered by an employer retirement plan at any time during the year, you may still be eligible for a deduction, depending on your Modified Adjusted Gross Income (MAGI) level (see Table A). Consult your tax advisor.
	•	Penalty-Free Usage. Your funds can be used penalty free for first-time home purchase (up to $10,000) and qualified higher education expenses.

Eligibility
If you have earned income (salary or wages), and/or your spouse has earned income, and you are under age 70½, you are eligible to contribute. (see Table B)

Contributions
The contribution limits for individuals will be increasing through 2008, and will continue to be subject to cost of living adjustments thereafter. And to help those who may have started saving for retirement late, a higher "catch up" contribution limit is available for those age 50 and over (see Table B). Contributions are limited to the lesser of the following two options: (1) applicable contribution limit; or (2) an individual's and/or spouse's earned income for a given year. The deadline to contribute is the tax filing deadline for that year (excluding extensions).

Other investment considerations

	•	IRS penalty-free withdrawals are allowed after age 59½, and must begin by age 70½. If funds are withdrawn before age 59½, you will pay a 10% IRS premature distribution penalty in addition to your regular income tax on all earnings and untaxed contributions, unless an exception applies.
	•	IRS penalties may be imposed if you do not begin taking distributions at age 70½.
	•	Eligibility for a tax-deduction varies by your Modified Adjusted Gross Income (MAGI) and whether you have a retirement plan at work. Consult your tax advisor.

Member FINRA/SIPC

	Online Services

	Resources

	Harris TV Calculators ATM Locations Harris Locations Security Tips Contact Us Talk to a Financial Advisor now.

	Quick Links

	Personal Financial Services Small Business Middle Market Corporate & Institutional Harris Private Bank Harris in the Community


	Corporate Information \| Careers \| Regulators \| Legal \| Security \| Privacy

Harris^® is a trade name used by Harris N.A. and its affiliates. Member FDIC.

Third party web sites may have privacy and security policies different from Harris. Links to other web sites do not imply the endorsement or approval of such web sites. Please review the privacy and security policies of web sites reached through links from Harris web sites.

Brokerage products offered through Harris Investor Services, Inc. registered broker/dealer, member FINRA/SIPC , SEC-registered investment adviser. Insurance and annuities offered through Harris Bancorp Insurance Services, Inc. Harris Investor Services, Inc. and Harris Bancorp Insurance Services, Inc. are affiliates of Harris N.A. and its banking subsidiaries. Products offered are: NOT A DEPOSIT - NOT INSURED BY THE FDIC OR ANY FEDERAL GOVERNMENT AGENCY - NOT GUARANTEED BY ANY BANK - MAY LOSE VALUE.

United States Department of Treasury Regulation Circular 230 requires that we notify you that, with respect to any statements regarding tax matters made herein, including any attachments, (1) nothing herein was intended or written to be used, and cannot be used by you, to avoid tax penalties; and (2) nothing contained herein was intended or written to be used, and cannot be used, or referred to in any marketing or promotional materials. Further, to the extent any tax statement or tax advice is made herein, Harris N.A. does not and will not impose any limitation on disclosure of the tax treatment or tax structure of any transactions to which such tax statement or tax advice relates. Harris N.A.does not provide legal advice to clients. You should review your particular circumstances with your independent legal and tax advisors.