Services
Account Options
Traditional IRA
A traditional IRA is a way to save for retirement that gives you tax advantages. Contributions you make to a traditional IRA may be fully or partially tax deductible. Generally, amounts in your traditional IRA, including earnings and gains, are not taxed until distributed from the IRA. For detailed information, visit https://www.irs.gov/retirement-plans/traditional-iras.
Roth IRA
A Roth IRA is a way to save for retirement that gives you tax advantages. Any earnings on assets in a Roth IRA generally grow tax free. Contributions to a Roth IRA are not tax deductible. Generally, when distributions are taken from a Roth IRA they are tax-free provided certain requirements are met. For more information, visit https://www.irs.gov/retirement-plans/roth-iras.
SEP IRA
A SEP IRA, or Simplified Employee Pension Plan, allows employers to contribute to traditional IRAs set up for employees. A business of any size, even self-employed, can establish a SEP. Compared to other types of employee retirement plans, SEPs are easy to set up and operate, have low administrative costs, and allow flexible annual contributions. For more information on SEPs, visit the IRS website at: https://www.irs.gov/retirement-plans/plan-sponsor/simplified-employee-pension-plan-sep.
Inherited (Beneficiary) IRA
An Inherited IRA is inherited from a deceased individual’s Traditional, SEP, or Roth IRA. Federal tax laws require that the entire inherited IRA be distributed within a certain amount of time. The length of time varies according to the beneficiary’s relationship with the original account owner and age of the original account owner. An inherited IRA allows you to leave the assets in the IRA to grow tax-deferred for as long as the rules permit. Additional information is available at https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-beneficiary.
Non-Qualified Account
Unlike IRAs, non-qualified accounts do not receive tax benefits from the IRS. Investment income and capital gains are taxed in the year in which they are incurred. CNB allows the following types of non-qualified account registrations: Individual, Joint Tenants with Rights of Survivorship, Tenants in Common, Trust, Conservatorship, Guardianship, Custodial for Minors, and Estate. Using a custodian for non-qualified accounts allows a combined statement, consolidated tax reporting, a savings account for dividends to be directed to, and one place to call for questions regarding all funds within the account. For financial advisors that work with fee-based accounts, this allows all investments to be combined into one account for easy fee calculation and payment of the advisory fee from cash within the account.
Asset Types
Our custodial service ensures flexibility through the variety of products allowed within a single self-directed account including, but not limited to, the following public and private investment products:
Annuities
An annuity is an insurance product that requires the insurance company to make periodic payments over a set timeframe, provide death benefits and tax-deferred growth. There are three basic types of annuities, fixed, variable and indexed. Fixed and indexed annuities are regulated by state insurance commissioners while variable annuities are regulated by the Security Exchange Commission (SEC).
Business Development Companies (BDCs)
A BDC is an organization that invests in and helps small- and medium-size companies grow in the initial stages of development.
Certificates of Deposit
A Certificate of Deposit is a savings certificate with a fixed maturity date and fixed or variable interest rate. When a CD is redeemed, you will receive the money you originally invested plus and accrued and unpaid interest. A CD restricts access to the funds until the maturity date and a penalty could be charged for early withdrawals.
Exchange Traded Stock
Publicly traded stock represents a piece of ownership in a company and is traded on a public exchange. CNB holds public stock, however we cannot facilitate a trade of the stock. You must work with your financial advisor to set up a DVP or retail brokerage account to trade public stock held at CNB.
Interval Funds
An interval fund is a type of closed-end fund with shares that do not trade on the secondary market. Instead the fund periodically offers to repurchase a percentage of outstanding shares at net asset value (NAV).
Limited Liability Companies
A limited liability company is a corporate structure whereby the members of the company are not personally liable for the company's debts or liabilities. While it is possible to hold a single member LLC in an IRA, CNB does not hold that type of investment in IRAs at this time. All LLCs held in IRAs at CNB must have multiple members.
Limited Partnerships
A limited partnership exists when two or more partners conduct a business in which one or more of the partners is liable only to the extent of the amount of money that partner has invested. Limited partners do not receive dividends but enjoy direct access to the flow of income and expenses. The main advantage to this structure is the owners are typically not liable for the company's debts.
Mutual Funds
A mutual fund is a company that uses a pool of money from investors and invests in various securities. Mutual funds typically have a fund manager that selects the securities and monitors the overall performance of the fund. Due to the range of companies and industry sectors in the portfolios, mutual funds offer diversification and liquidity to their investors.
Private Bank and Holding Company Stock
Private bank stock represents a piece of ownership in a bank or holding company that is not traded on a public stock exchange. CNB is known as an expert for providing custody for this type of investment, for more information click here.
Private Placements, Reg D Funds, Private Stocks, Private Equity, Hedge Funds, Oil & Gas Funds, Direct Participation Programs
A private placement is a capital raising event that involves the sale of securities to a relatively small number of select investors. Private Placements are not required to be registered with the Securities and Exchange Commission (SEC).
Promissory Notes and Debentures
Promissory notes are debt instruments that allow companies and individuals to get financing from a source other than a bank. In effect, anyone becomes a lender when he issues a promissory note. A debenture is a type of debt instrument that is not secured by physical assets or collateral. Debentures are backed only by the general creditworthiness and reputation of the issuer. Both corporations and governments frequently issue this type of bond to secure capital.
Real Estate Investment Trusts (REITs)
REITs are a form of real estate investment that allow individual investors to invest in commercial real estate portfolios that receive income from a variety of properties, including apartment complexes, shopping malls, data centers, healthcare facilities, hotels, infrastructure, office buildings, retail centers, self-storage, timberland and warehouses.
You are urged to seek professional guidance and/or consider proper diversification and risk tolerance before directing any investment activity. Community National Bank (CNB) does not recommend or evaluate the prudence, merit, viability or suitability of any investment and will not be responsible for the performance of any investment product. CNB will provide custodial services with respect to the investments in your IRA, but we do not provide investment advice or information, nor are we the agent, partner, employee, representative, or affiliate of any financial representative, product sponsor or other individual or entity except as otherwise disclosed. We are not responsible for and are not bound by any representations, warranties, statements, agreements, disclosures, advice or information made by any such person beyond the terms and provisions contained in the CNB Custodial Agreement, Disclosure Statements, or other CNB forms or CNB documents.
Visit www.investor.gov for helpful hints on questions to ask before you invest, how to avoid fraud, and additional information on investment products.
Asset Acceptance
CNB reviews every investment from an administrative standpoint before accepting for custody. Please call or email to verify if the investment you would like held at CNB has already been accepted for custody. If it has not been reviewed CNB will require:
- Request for Custody form completed by someone at the investment company
- A list of officers and principals
- List and explanation of any pending litigation
- Offering materials including prospectuses, offering memorandums, operating agreements, subscription agreements, etc.