Traditional IRA

A Traditional Individual Retirement Account (IRA) can be a tax-efficient way to save for your retirement. Not only can you grow your retirement funds faster through tax-deferred investment earnings, but a Traditional IRA can also reduce your current taxable income by the amount of your deductible IRA contributions.

As part of the mix of investment options for your Traditional IRA, SunTrust Bank offers FDIC insured Certificates of Deposits (CDs) and money market accounts and SunTrust Investment Services, Inc. offers investment products such as mutual funds and stocks.

A SunTrust advisor can help you determine whether a Traditional IRA account is appropriate for you.

To contact a SunTrust advisor call 844.206.8900.

Why open a Traditional IRA?

  • Tax-deferred earnings help you grow your savings
  • Current tax deductions for annual IRA contributions (subject to eligibility criteria)
  • No income limit to make contributions, provided you are not participating in an employer-sponsored retirement plan
  • Flexibility to convert to a Roth IRA

Traditional IRA eligibility rules

  • Individuals must be younger than age 70½ to make contributions.
  • Individuals must have earned income in the year that they make a contribution.
  • If you can’t deduct your contributions, you can still make non-deductible contributions and benefit from tax-deferred investment earnings.
  • Even if you’re in an employer-sponsored retirement plan, you can also contribute to a Traditional IRA.
  • Your income determines how much of your IRA contribution is tax-deductible.

Traditional IRA contribution limits

Traditional IRA limits on annual contributions for 2017 are:

  • $5,500 for single individuals up to age 50
  • $6,500 for single individuals age 50 and over
  • $11,000-$13,000 for married couples filing jointly ($5,500 maximum for each joint filer up to age 50, $6,500 each for those 50 and older)

If you wish, you can contribute to a Traditional IRA and a Roth IRA in the same year, but your total contribution is limited to the amounts shown above.

Traditional IRA distribution rules

  • You are required to pay federal income taxes on your Traditional IRA withdrawals once you start taking distributions. (nondeductible contributions are not taxed when distributed)
  • You can begin making penalty free withdrawals as early as age 59½; withdrawals prior to age 59½ may incur a 10% early withdrawal penalty.
  • Required distributions generally must begin at age 70½; significant tax penalties can apply for failure to take minimum required distributions.
  • Early distributions can be taken without a penalty if certain criteria are met (such as to buying a first home or for qualified higher-education expenses.)

NOTE: Eligibility and contribution amount information is valid as of January 1, 2017.

SunTrust Bank and its affiliates and the directors, officers, employees and agents of SunTrust Bank and its affiliates (collectively, “SunTrust”) are not permitted to give legal or tax advice. While SunTrust can assist clients in the areas of estate and financial planning, only an attorney can draft legal documents, provide legal services and give legal advice. Clients of SunTrust should consult with their legal and tax advisors prior to entering into any financial transaction or estate plan. Because it cannot provide legal services or give legal advice, SunTrust’s services or advice relating to “estate planning” are limited to (i) financial planning, multi-generational wealth planning, investment strategy, (ii) management of trust assets, investment management and trust administration, and (iii) working with the client’s legal and tax advisors in the implementation of an estate plan.

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