Individual Retirement Accounts (IRAs)
Individual Retirement Accounts are one of the most effective ways to accumulate savings for retirement. Pioneer Bank offers many FDIC insured IRA options to choose from, and knowledgeable employees to help you decide which choice is best for you.
Pioneer Bank can help you decide, based on your individual circumstances, what type of IRA may work best for you, and what investment options would best fit your long-term goals. Whether it’s a Traditional IRA with tax-deductible contributions and tax-deferred earnings or a Roth IRA with after-tax contributions and tax-free earnings, Pioneer Bank has the plan for you.
Traditional IRA
A Traditional IRA is a special tax-deferred* savings plan authorized by the federal government to encourage you to accumulate money for retirement. Contributions to a Traditional IRA may be tax deductible* (subject to eligibility) and will grow tax deferred because earnings and gains are not taxed until they are withdrawn.
Eligibility
- Must be under age 70 ½ for the year the contribution is being made
- Must have earned income
Tax advantages
- Contributions may be tax deductible*
- Tax deferred earnings
- Distribution of tax deductible contributions and earnings may be taxed as ordinary income
Roth IRA
A Roth IRA helps you save for retirement by sheltering your investment from federal income tax in the future. Contributions to a Roth IRA are non-deductible and are made on an after-tax basis. Earnings accumulate tax free and distributions are tax and penalty free if they meet the IRS requirements of a “qualified distribution”.* Contributions, excluding earnings on those contributions, can be withdrawn for any qualifying reason without penalty or taxes after a five-year holding period.
Eligibility
- No age limit
- Must have earned income
Tax Advantages
- Tax free earnings*
- Distributions are tax and penalty free if they meet the IRS requirements of a "qualified distribution"
Beginning January 2010, new rules apply to conversions from a Traditional IRA to a Roth IRA. To learn whether a conversion makes sense for you, please consult your tax advisor.
Types of IRA Investments at Pioneer Bank
- Certificate of Deposit
- Regular Savings account
- IRAs are also available through our Investment Center.
*Please consult your tax or legal advisor for specific information regarding your individual circumstances and the tax treatment of any of the retirement accounts you select.
Simplified Employee Pension (SEP) Retirement Plans for Small Businesses
A SEP can provide a significant source of income at retirement by allowing employers to set aside money in retirement accounts for themselves and their employees. If a self-employed person does have employees, all employees must receive the same benefits under a SEP plan. Since SEP accounts are treated as IRAs, funds can be invested the same way as any other IRA.*
*Please consult your tax or legal advisor for specific information regarding your individual circumstances and the tax treatment of any of the retirement accounts you select.
Health Savings Accounts (HSAs)
A Health Savings Account (HSA) is a tax-favored savings account that is exclusively for the purpose of paying for or reimbursing for qualified medical expenses.
Eligibility
- Must be covered under a high deductible health plan (HDHP) on the first day of a month to qualify
for eligibility for that month - Cannot be covered by any other health plan that is not an HDHP
- Cannot be enrolled in Medicare; and
- Cannot be claimed as a dependent on another individual’s tax return.
What is a high deductible health plan (HDHP)?
A HDHP is a health insurance plan with an annual deductible no less than $1,200 for self-coverage and $2,400 for family coverage.
Types of HSA Accounts at Pioneer Bank
- Interest Checking
- Regular Savings
- Certificate of Deposits
For further information on IRAs and HSAs, please contact any of our six locations.
