Traditional IRA or Roth IRA

When Can I Withdraw Funds without Incurring any IRS Penalties?

Traditional IRA - Distributions from traditional IRAs and most employer-sponsored retirement plans are taxed as ordinary income and may be subject to an additional 10 percent federal income tax penalty if taken prior to reaching age 59½. This penalty may be avoided before age 59½ if you should become disabled, for qualified higher education expensed or for a first-time home purchase.*

Roth IRA -  Unlike a traditional IRA or an employer sponsored retirement plan, a Roth IRA is not subject to annual required minimum distributions after age 70½. As long as Roth IRA withdrawals take place after age 59½ or due to death, disability, or a first-time home purchase (up to a $10,000 lifetime maximum), and the account has been open for at least five years, distributions will be free of federal tax and penalties.

When Must  I Withdraw Funds?

Traditional IRA - When you reach your age 70½ year, you must begin to take minimum required withdrawals or severe penalties will be imposed.

Roth IRA -  There are no required distributions from a Roth IRA.

Talk with a Baylake Bank Customer Service Representative near you for more information about IRA withdrawals.

*Consult your tax advisor.