Individual Retirement Accounts (IRAs)

Find the right IRA for you
Understanding Roth & Traditional IRAs
Roth IRA
  • Any qualified distributions of earnings are federally tax-free and may be state tax-free if withdrawn at or after age 59½ and the individual retirement account has been open five years or more1 
  • Contributions (not earnings) can be withdrawn free of tax and the 10% additional tax at any time
  • Contributions are not tax-deductible
Traditional IRA
  • Any earnings are tax-deferred until withdrawn at or after age 59½ at which time they are taxed at your current rate2
  • Contributions and earnings can be withdrawn free of the 10% additional federal income tax at or after age 59½
  • Contributions may be tax-deductible
Rollover IRA
Consolidating your retirement assets into one easy-to-manage account is simple with a Rollover IRA. A Rollover IRA isn't right for everyone. Consider all of your choices and learn if a Rollover IRA may be right for you.3

Have questions? Talk to a Merrill Edge rollover specialist, 24 hours a day, 7 days a week at 1.888.637.3343
Small Business IRAs
A small business IRA, such as a simplified employee pension (SEP) or a savings incentive match plan for employees (SIMPLE), can help you and your employees prepare for retirement. A SEP or a SIMPLE plan can also provide the opportunity for valuable tax advantages and serve as an effective tool for attracting and retaining employees.
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Questions & Answers
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1 Any earnings are tax-free if you are at least 59½ or unless you qualify for an exception and the Roth IRA has been funded for at least five years from the year of conversion. There is a 10% additional tax for withdrawals of earnings taken before age 59 ½.

2 For Traditional IRAs — If you withdraw before age 59 ½ you may be subject to a 10% early withdrawal additional tax unless one of the following exceptions apply: qualified higher education expenses; qualified first home purchase (lifetime limit of $10,000); certain major medical expenses; certain long-term unemployment expenses; disability; or substantially equal periodic payments.

3 You have choices for what to do with your employer sponsored retirement plan. Depending on your financial circumstances, needs and goals, you may choose to roll over to an IRA or convert to a Roth, roll over to an employer sponsored plan from a prior employer to an employer sponsored plan at your new employer, take a distribution or leave the account where it is. Each choice may offer different investment options and services, fees and expenses, withdrawal options, required minimum distributions, tax treatment and provide different protection from creditors and legal judgments. These are complex choices and should be considered with care. Visit http://www.merrilledge.com/retirement/rollover-ira or call a Merrill Edge rollover specialist at 1.888.637.3343 for additional information about your choices.

Neither Merrill Lynch, Pierce, Fenner & Smith Incorporated nor any of its subsidiaries are tax or legal advisors. We suggest you consult your personal tax or legal advisor before making tax or legal-related investment decisions.

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