Traditional IRA

DOCO Regional FCU offers a Share Savings IRA that pays the same monthly dividend rate as Share Savings Accounts. Six month up to 24 month certificates are also available. A minimum of $1,000.00 is required to set up a Share Certificate.

Individual retirement accounts are a smart way to save for the future. A traditional IRA can be opened and funded without any employer participation. Contributions and/or earnings are tax-deferred until retirement. Unlike many employer plans, money in the account is always accessible; however, until age 59 1/2 there is a 10 percent early distribution penalty unless you qualify for an exemption due to one of the following: direct roll over or transfer, amount converted to a Roth IRA, payment to beneficiaries after death, withdrawal of up to $10,000 for first-time home purchase, to pay post-secondary education expenses, catastrophic medical expenses, disability, etc.

For more information on a traditional IRA please contact the Member Services Department at the nearest branch office. Click here for branch office phone numbers. To view current rates click here.

Roth IRA

An owner's compensation and income determine eligibility for opening and contributing to a Roth IRA, and the amount of the eligible contribution. There is no age limit to contributions as long as you meet the compensation and income requirements. Roth IRAs differ from Traditional IRAs in that the money you contribute to a Roth IRA has already been taxed. So the principal amount is never subject to taxes or penalties in the future, as long as you stay within the contribution guidelines. This retirement plan allows the money you contribute to grow tax-deferred. If you do not withdraw any of the earnings until you have had the plan for at least five years, or satisfy one of the qualifying events, those tax-deferred earnings become tax free. Unlike the traditional IRA, there is no 70 1/2 age limit on making contributions. You simply need to have earned income equal to the amount you contribute up to a maximum of $3,000 per year for tax years 2002-2004.

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Coverdell Educational IRA

A Coverdell Education savings account can be used to fund a child's education. An Educational IRA can be opened for any child under the age of 18. You may contribute a maximum of $2,000 per year per child until the student's 18th birthday. The child is the account beneficiary. Like the Roth IRA, contributions to the account are not tax deductible but earnings accumulate tax free. Withdrawals from Educational IRAs can be used to pay for tuition, books, supplies and room and board (for full-time students).

If a child does not attend college, the money must be withdrawn by the time he or she turns 30. Those earnings are subject to income tax and the 10% penalty. The Coverdell Education savings account can also be rolled over without penalty to another member of the family.

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* The Credit Union provides no legal advice to members, and provides the foregoing information from a reliable resource to give our members a basic understanding of these services. You should consult with your tax or legal adviser regarding any particulars and the current status of applicable federal and state laws.