Terre Haute Savings Bank
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Traditional IRA

Allows you to defer taxes on your earnings until they are withdrawn. Also, certain contributions are tax-deductible in the year they are made.


If you are under age 70½ for the entire tax year and have earned income, you are eligible to establish a traditional IRA.


The Economic Growth and Tax Relief Reconciliation Act of 2001 has increased contribution limits to the following levels:

2017 - 2018: $5,500

Those 50 years old and over may contribute an additional $1,000 per year

Tax deductible

Based on whether you are an active participant in an employer-maintained retirement plan. You may be eligible for the maximum deduction, a partial deduction, or no deduction.

Taxable earnings

Tax deferred until withdrawal

Withdrawal without penalty

You can withdraw funds from your traditional IRA without incurring a 10% IRA premature-distribution penalty after you reach age 59 ½.
You can avoid the penalty before age 59 ½ if:

  • You become disabled
  • The distributions are part of substantially equal periodic payments
  • Certain unreimbursed medical expenses
  • For health care insurance if you've been receiving unemployment compensation for at least 12 weeks.
  • Qualified higher education expenses
  • For a first-time home purchase


If over age 59½, include the taxable portion of the amount withdrawn as income. If under 59 ½ and do not meet one of the exceptions, you must also pay a 10% IRS penalty for premature distribution.

Required Distributions

At age 70½, you must begin to take minimum required withdrawals or severe penalties will be imposed.

FDIC Equal Housing Lender
Terre Haute Savings Bank - 533 Ohio Street - Terre Haute, IN 47808 - 1-888-245-1929 - (812) 234-4864 - Fax (812) 234-4860 - Bank-By-Phone (877) 611-3880