IRAs

Individual Retirement Accounts (IRAs) are tax-advantaged retirement accounts designed to help individuals save for their future financial security. Contributions can be made in amounts that fit your budget, subject to IRS annual contribution limits. Depending on the type of IRA and your eligibility, you may benefit from tax-deductible contributions, tax-deferred growth, or tax-free qualified withdrawals. SNPJ IRAs are funded through SNPJ annuity products, combining the tax advantages of an IRA with the guarantees and features available through an SNPJ fixed annuity.

IRA contribution eligibility is based on earned income and IRS requirements. Both working individuals and certain non-working spouses may qualify to contribute to an IRA. Traditional IRA contributions may be tax deductible, depending on factors such as income, tax filing status, and participation in an employer-sponsored retirement plan. Roth IRA eligibility is also subject to IRS income limitations.

Funds may generally be withdrawn from an IRA at any time; however, taxes and penalties may apply depending on the type of IRA, the account owner’s age, and the reason for the withdrawal. Withdrawals taken before age 59½ may be subject to a 10% IRS early withdrawal penalty unless an exception applies. Common exceptions may include:

• Payments made to a beneficiary following the account owner’s death
• Distributions due to qualifying disability
• Certain substantially equal periodic payment programs
• Qualified unreimbursed medical expenses
• Qualified first-time home purchase expenses
• Qualified higher education expenses

SNPJ members may open an IRA with as little as $25 per month. Non-members may open an IRA with a minimum initial contribution of $2,000. Contributions may be made annually, semiannually, quarterly, monthly, or through other flexible contribution schedules. Contributions for a tax year may be made until the federal tax filing deadline for that year, excluding extensions.

For additional information regarding IRAs, consult current IRS publications 590A and 590B or visit the IRS website. Because tax laws frequently change and every individual’s financial situation is unique, SNPJ recommends consulting a qualified tax professional, financial advisor, or attorney before making retirement planning decisions.

DISCLAIMER:
This information is provided for educational purposes only and is not intended as tax, legal, or financial advice. Because individual circumstances vary, you should consult with your tax advisor, attorney, or financial professional before making financial decisions.