Retirement Accounts

When it comes to financial security in retirement, planning is where it all begins. We can help you set up a retirement account that will help you prepare for that fun and exciting retirement you’ve been dreaming of. If you’re already retired, our bankers can assist you with a plan that keeps your money working hard for you.

Account Types

An Individual Retirement Account, commonly called an IRA, is a personal savings plan which allows you to set aside money for retirement, while offering you tax advantages. At Community Bank we offer a variety of IRA accounts including the following:

Traditional IRA

A Traditional IRA is an account set up to save for retirement that offers special tax advantages. These include tax deductions on contributions, if eligible, tax-deferred earnings, and additional tax credit for qualifying individuals.

Roth IRA

A Roth IRA is an account set up to save for retirement that offers special tax advantages that differ from a Traditional IRA. A Roth IRA does not offer a tax deduction for contributions made to the account but offers tax-exempt earnings for qualified distributions. It also offers tax-deferred earnings and an additional tax credit for qualifying individuals.

SEP

Simplified Employee Pension is a Traditional IRA set up by an employer for an employee. Only the employer can make contributions to the IRA and the employee is 100% vested in the account which means they have full ownership of the money.

SIMPLE

A Savings Incentive Match Plan for Employees allows employers to contribute to a traditional IRA for their employees. This account is ideal for small employers who want to start a retirement savings plan for their employees. Employers cannot have any other retirement plan and must contribute to the plan each year. Employees may also elect to contribute and are always 100% vested in the account.

Coverdell Education Savings Account

A Coverdell Education Savings Account is an account created as an incentive to help parents and students save for educational expenses. Contributions are not tax deductible but grow tax free until distributed. The beneficiary (someone under the age of 18) will not owe tax on the distributions if they are less than their qualified education expenses at an eligible institution such as a qualified higher education, elementary, or secondary education.

Transfers and Rollovers

If you are changing jobs, retiring or you would simply like to move your current IRA from another account to Community Bank, we can assist you with the transfer or rollover of your retirement dollars into an IRA.

Benefits

It is never too early to start thinking about your retirement. Many individuals rely solely on Social Security and employee-sponsored retirement plans to provide retirement income, but many times this provides inadequate income during retirement. Regardless of the type of IRA that you are interested in, Community Bank offers a variety of account options.

After-tax advantages
Variety of rates and terms
Fixed interest rate for the term of investment
Rate adjusts to current standard interest rate upon maturity
A penalty may be imposed for early withdrawal
Insured by the Federal Deposit Insurance Corporation for up to $250,000 per depositor

Traditional IRA Tax Deductible Limits

You are covered by employer's plan
Single
2024	$77,000 and not more than $87,000
2025	$79,000 and not more than $89,000
Married, Filing Jointly
2024	$123,000 and not more than $146,000
2025	$126,000 and not more than $146,000
Married, Filing Separately
2024	$0 and not more than $10,000
2025	$0 and not more than $10,000

You are covered by employer's plan	2024	2025
Single	$77,000 and not more than $87,000	$79,000 and not more than $89,000
Married, Filing Jointly	$123,000 and not more than $146,000	$126,000 and not more than $146,000
Married, Filing Separately	$0 and not more than $10,000	$0 and not more than $10,000

You are not covered by employer's plan
Single
2024	No income limits
2025	No income limits
Married, Filing Jointly Spouse not covered by retirement plan at work
2024	No income limits
2025	No income limits
Married, Filing Separately Spouse is covered by retirement plan at work
2024	$230,000 and not more than $240,000
2025	$236,000 and not more than $246,000

You are not covered by employer's plan	2024	2025
Single	No income limits	No income limits
Married, Filing Jointly Spouse not covered by retirement plan at work	No income limits	No income limits
Married, Filing Separately Spouse is covered by retirement plan at work	$230,000 and not more than $240,000	$236,000 and not more than $246,000

Traditional IRA FAQs

What is a Traditional IRA?

A Traditional IRA is a tax-deferred account in which contributions are made with pre-tax dollars. This allows the money contributed to the Traditional IRA to compound tax-free until funds are withdrawn. Earnings in a Traditional IRA are tax-deferred until withdrawn by the IRA owner or his/her beneficiary. There is no age limit on making regular contributions to your Traditional IRA.

What is earned income?

Earned income is defined as the wages, salaries, commissions, bonus, compensation, alimony and any other amount that you receive for providing personal services. Passive income such as interest, dividends, pensions, and most rental income are not considered compensation for the purpose of funding an IRA.

What are the Traditional IRA Contribution Limits?

In 2025, the contribution limit for all of your Traditional and Roth IRAs cannot be more than $7,000.

Can I make a catch-up contribution?

In 2025, if you're age 50 or older you can contribute up to $8,000.

How do I know if I'm eligible to contribute?

You can set up and make contributions to a Traditional IRA if you (or, if you file a joint return, your spouse) received taxable compensation during the year.

Is my Traditional IRA contribution tax deductible?

It depends. Anyone can make a contribution to a Traditional IRA, but that doesn't mean it's tax deductible for everyone. If you're covered by a retirement plan at work, your tax deduction for contributions to a Traditional IRA is reduced (phased out) based on your modified adjusted gross income (AGI).

Traditional IRA Deductible Limits - You Are Covered by Employer's Plan

Single
- 2024: $77,000 and not more than $87,000
- 2025: $79,000 and not more than $89,000
Married, Filing Jointly
- 2024: $123,000 and not more than $143,000
- 2025: $126,000 and not more than $146,000
Married, Filing Separately
- 2023: $0 and not more than $10,000
- 2024: $0 and not more than $10,000

Traditional IRA Deductible Limits - You Are Not Covered by Employer's Plan

Single
- 2024: No Income Limits
- 2025: No Income Limits
Married, Filing Jointly, Spouse not covered by retirement plan at work
- 2024: No Income Limits
- 2025: No Income Limits
Married, Filing Jointly, Spouse is covered by retirement plan at work
- 2024: $230,000 and not more than $240,000
- 2025: $236,000 and not more than $246,000

When can I start taking withdrawals from my IRA?

You can withdraw funds from a Traditional IRA without penalty at any time after you have attained the age of 59½.

When must I start taking withdrawals from my IRA?

You must start taking a Required Minimum Distribution (RMD) the calendar year you reach age 75.

Can I withdraw funds before I reach age 59 ½?

If you decide to withdraw money from your Traditional IRA account prior to the attainment of age 59½ you will be subject to the imposition of a 10% early distribution penalty tax. The following are exceptions to the 10% early distribution penalty tax:

You have unreimbursed medical expenses that are more that 7.5% of your adjusted gross income.
The distributions are not more than the cost of your medical insurance.
You are disabled.
You are the beneficiary of a deceased IRA owner.
You are receiving distributions in the form of an annuity.
The distributions are not more than your qualified higher education expense.
You use the distributions to buy, build, or rebuild a first home.
The distribution is due to an IRS levy.
You are in the military reserve and the distribution is a qualified reservist distribution.

Where can I learn more about Traditional IRA Rules?

Guidance regarding the rules and restrictions imposed upon IRAs can be found in IRS PUBLICATION 590

Roth IRA FAQs

What is a Roth IRA?

A Roth IRA is an individual retirement account that is similar to a Traditional IRA, however, you cannot deduct contributions to a Roth IRA from your taxable income.

How do I know if I'm eligible to contribute?

Generally, you can contribute to a Roth IRA if you have taxable compensation and your Modified Adjusted Gross Income (MAGI) is less than:

Married Filing Jointly or Qualifying Widow(er):
- 2024: $230,000 and not more than $240,000
- 2025: $236,000 and not more than $246,000
Single, Head of Household, or Married Filing Separately and you did not live with your spouse at any time during the year:
- 2024: $146,000 and not more than $161,000
- 2025: $150,000 and not more than $165,000
Married Filing Separately and you lived with your spouse at any time during the year:
- 2024: $10,000
- 2025: $10,000

What is considered compensation?

Compensation includes wages, salaries, tips, professional fees, bonuses, and other amounts received for providing personal services. It also includes commissions, self-employment income, nontaxable combat pay, military differential pay, and taxable alimony and separate maintenance payments.

What is Modified AGI?

Your modified AGI for Roth IRA purposes is your adjusted gross income (AGI) as shown on your return modified for certain deductions or expenses. Use the worksheet in IRS Publication 590 to determine your Modified Adjusted Gross Income.

Is there an age limit for contributions?

Contributions can be made to your Roth IRA regardless of your age.

Can you contribute to a Roth IRA for your spouse?

You can contribute to a Roth IRA for your spouse provided you file jointly and your MAGI is less than $236,000 and not more than $246,000 in 2025.

When must I start taking withdrawals from my IRA?

You are not required to take distributions from your Roth IRA. You can leave amounts in your Roth IRA as long as you live.

Are distributions taxable?

Qualified distributions or distributions that are a return of your regular contributions for your Roth IRA are not taxable.

What are Qualified Distributions?

A qualified distribution is any payment or distribution from your Roth IRA that meets the following requirements:

It is made after the 5-year period beginning with the first taxable year for which a contribution was made to a Roth IRA set up for your benefit, and
The payment or distribution is:
- made on or after the date you reach age 59 ½
- made because you are disabled
- made to a beneficiary or to your estate after your death, or
- one that meets the requirements under the First Home Exceptions up to a $10,000 lifetime limit.

When is a distribution taxable?

If you receive a distribution that is not a qualified distribution, you may have to pay the 10% additional tax on early distributions. See the IRS Publication 590 for further information.

Where can I learn more about Roth IRA Rules?

Guidance regarding the rules and restrictions imposed upon IRAs can be found in IRS PUBLICATION 590