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Individual Retirement Accounts

Take advantage of our many types of tax-deferred accounts to suit your needs! 1st Capital Bank features several types of Individual Retirement Accounts with a low minimum opening balance of $200.00.  We offer Traditional IRA, SEP, Roth and Education (CESA) accounts with fixed rate and maturities of 12 and 18 months.  For more information, please contact one of our branches.

Traditional IRA

Tradition IRA

Are you looking for an IRA, in which your contributions are tax deductible in the tax year that you allocate them? Then this is the one for you. Contributions to an IRA are based upon compensation and age.

Features

  • Age Eligibility: under 70 ½  years to make a regular Traditional IRA contribution for any tax year
  • Defer taxes on the earnings of contributions until withdrawn
  • Contributions ranging from fully deductible to non-deductible—based on your Adjusted Gross Income (AGI) and filing status
  • Early withdrawals (prior to age 59 ½) are taxable and incur 10% premature-distribution penalty fee to the IRS
  • A low annual maintenance fee.
Note: Consult your Tax or Legal Advisor for specific tax-related rules and information. 

Simplified Employee Pension (SEP) IRA

SEP IRA

A Simplified Employee Pension (SEP) plan is a retirement plan established 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.

Features

  • Eligibility: Any business owner (both incorporated and non-incorporated), sole proprietors and partnerships are eligible
  • Employers must contribute a uniform percentage of compensation for each eligible employee
  • Good plan for employers with low number of employees
  • Less expensive to administer than 401K or profit sharing plans
Note: Consult your Tax or Legal Advisor for specific tax-related rules and information. 

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Roth IRA

Roth IRA

A Roth IRA is an individual retirement account that allows only non-deductible contributions but features tax-free withdrawals for certain distribution reasons after a five-year holding period. Tax-free means free from Federal Income Tax.

Features

  • Eligibility: based on compensation and your Modified Adjusted Gross Income (MAGI), for which any tax year cannot exceed certain prescribed limits
  • No taxes on distributions
  • Easier tax-free access to the assets
  • Early withdrawals (prior to age 59 ½) are taxable and incur 10% premature-distribution penalty fee to the IRS
  • Earnings may be subject to tax unless removed as a qualified distribution

Qualified Distribution: Distributions of earnings are not taxable as long as:

  • 5 years have passed since you established your first Roth IRA

AND

  • You are at least age 59 ½, permanently disabled, taking first-time homebuyer distributions, OR deceased
Note: Consult your Tax or Legal Advisor for specific tax-related rules and information. 

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Education (CESA) IRA

Education IRA

The Coverdell Education Savings Account is a nondeductible account that qualities for tax-free withdrawals for a child’s education expenses—children younger than 18 years old.

Features

  • Eligibility: based on your modified adjusted gross income (MAGI)
  • No compensation requirements or age restrictions for contributors
  • No direct relationship to the child necessary
  • Contributors can be corporations or tax-exempt organizations
  • No taxes on distributions
  • Earnings grow tax-free when used for qualified education expenses, including private elementary and secondary schooling, and higher education through a vocational school, college or university
Note: Consult your Tax or Legal Advisor for specific tax-related rules and information. 

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Rate information:
Interest rate and Annual Percentage Yield are subject to change on your account at anytime. You can contact our branches for current interest rate and Annual Percentage Yield information.
Balance Computation Method
We use the daily balance computation method to calculate the interest on your account. This method applies a daily periodic rate to the principal in the account each day.
Interest Compounding Method and Credit Frequency:
The compounding method is simple interest. Interest will be credited to your account monthly.