Individual Retirement Accounts (IRAs)

Grow your wealth and prepare for your retirement with tax-advantaged IRA savings. FB&T offers Savings Accounts, Investment Money Market Accounts or CDs as IRAs.

First Bank & Trust provides many types of Individual Retirement Accounts to fulfill the different needs of our clients. Contact your accountant or tax-preparer to determine your eligibility and to establish which of these products would be the most appropriate for you.

  • Traditional IRAs offering tax-deductible contributions
  • Roth IRAs offering tax-free distributions of contributions and qualified earnings
  • Coverdell Education Savings Account offering savings for college tuition
  • SEP IRAs offering self-employed individuals and small business employees access to a retirement plan

Traditional IRAs

For taxpayers wishing to deduct their IRA contributions and defer tax on the earnings until they are withdrawn. When contributions are withdrawn, deductible contributions and all earnings are treated as income and are taxed. Deposits may be made by those who are under 70-1/2 for the entire tax year and have earned income (or a spouse with earned income). Funds may be withdrawn from this type of IRA penalty free anytime the taxpayer reaches age 59-1/2 and for several other qualifying reasons.

Roth IRAs

Let your IRA earnings grow tax exempt. When withdrawn, you won’t be charged income tax on earnings if you meet the requirements for a qualified distribution. Roth IRAs are non-deductible deposits that feature tax-free withdrawals for certain distribution reasons after being on deposit for 5 years. Roth IRA distributions are not subject to federal taxes but state taxes may apply. Either the depositor or spouse must have earned income and the modified adjusted gross income may not exceed the prescribed limit.

Coverdell Education Savings Accounts

Start saving money for a child’s education expenses. Contributions aren’t tax-deductible but, generally, distributions used to pay for qualified educational costs are tax free. Beneficiaries may receive no more than $2000 per year and can use these funds for most expenses for educational purposes from elementary through post-secondary schools.

Simplified Employee Pensions (SEP Accounts)

Allow an employer to make deductible contributions for the benefit of participating employees. This may be done if the employee is also the employer and, in fact, is the only qualifying employee. A SEP-IRA is set up as a Traditional IRA for the affected employee(s).

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