THE
XXXXX
TREASURY
FUNDS
INDIVIDUAL RETIREMENT ACCOUNT
APPLICATION INSTRUCTIONS 2
APPLICATION, ADOPTION AGREEMENT &
BENEFICIARY DESIGNATION 3
TRANSFER AUTHORIZATION FORM 5
ROLLOVER CERTIFICATION FORM 7
IRA DISCLOSURE STATEMENT 8
CUSTODIAL ACCOUNT AGREEMENT 12
1
APPLICATION INSTRUCTIONS
1. HOW TO COMPLETE THE ENCLOSED FORMS:
IF YOU ARE OPENING AN IRA WHICH WILL NOT CONTAIN CONTRIBUTIONS THAT HAVE BEEN
TRANSFERRED FROM ANOTHER IRA OR QUALIFIED RETIREMENT PLAN:
-- To establish an IRA, please complete the "Application, Adoption
Agreement and Beneficiary Designation" (Application). Please note that
the Applicant's name must be that of an individual not a business.
-- If you are opening an IRA for your non-working spouse, a separate
Application must be completed by your spouse. Please be sure to check
the option for "Spousal IRA" under "Type of Account" in section 1 on
page 2 of the Application packet.
-- The maximum allowable contribution for an IRA is $2,000 per year (or
$2,250 per year combined contribution for an Individual and a Spousal
IRA, with neither account receiving more than $2,000).
-- The minimum initial investment per Fund is $1000. If you are dividing
your contribution between IRAs for yourself and your non-working spouse,
the amounts invested per Fund in each account will be combined for the
purpose of satisfying the minimum initial investment. Prospectuses for
the Funds may be obtained from Xxxxx Funds, Inc. at 1-800-xxx-xxxx.
Please be sure to read the prospectus carefully before investing.
-- Please be sure to read carefully the "Terms and Conditions of the IRA
Adoption Agreement" in Section 5 of the Application. There is a $10
annual custodial maintenance fee on this account.
-- Please make checks payable to Xxxxx Treasury Funds. If you are dividing
your contribution between an Individual and a Spousal IRA, only one
check, with instructions how to allocate the contribution between
accounts, needs to be included with both Applications.
IF YOU ARE OPENING AN IRA WHICH WILL CONTAIN CONTRIBUTIONS WHICH HAVE BEEN
TRANSFERRED FROM ANOTHER IRA OR QUALIFIED RETIREMENT PLAN:
-- Please read and follow the instructions above for establishing an IRA.
Be sure to note on the Application that your contribution is a rollover
from another IRA or qualified retirement plan.
-- To transfer the distribution from your current IRA or qualified
retirement plan directly from the trustee (custodian) of that plan to
the custodian for the IRA, please complete the "Transfer Authorization
Form." Please note that if an eligible rollover distribution from a
qualified plan is not transferred directly to another qualified plan or
an IRA, the IRS mandatory 20% withholding amount will be withheld from
the distribution.
-- To certify that the contribution you are making to the IRA is a rollover
from an IRA or a qualified retirement plan, please complete the
"Rollover Certification Form." Rollovers must be completed within 60
calendar days of the date you receive the distribution.
2. MAIL THE COMPLETED APPLICATION AND CHECK (IF APPLICABLE) TO:
REGULAR MAIL: OVERNIGHT EXPRESS:
PFPC Inc. PFPC Inc.
Attn: Xxxxx Treasury Funds IRA Attn: Retirement Plans
P.O. Box 8969 000 Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000-8969 Wilmington, DE 19809
0-000-000-0000
2
APPLICATION, ADOPTION AGREEMENT & BENEFICIARY DESIGNATION
Please complete both pages of this form to establish an IRA.
1. TYPE OF ACCOUNT (PLEASE CHECK ONE OF THE OPTIONS BELOW.)
__ Regular IRA __ SEP IRA--Name of Employer __ IRA Rollover
__ Spousal IRA __ Rollover/Direct Rollover from a __ Direct Transfer
Qualified Retirement Plan IRA to IRA
2. REGISTRATION-DEPOSITOR
- -
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First Name Middle Initial Last Name Social Security Number
/ /
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Street Date of Birth
( )
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City State Zip Code Telephone
3. INVESTMENT (PLEASE INDICATE THE PERCENTAGE OF YOUR CONTRIBUTION YOU WISH TO
INVEST IN EACH FUND.)
Initial investments must be at least $ 1000.00.
Enclosed is a check for $___ payable to Xxxxx Treasury Funds to be invested
in each Fund as follows:
This contribution applies to the tax year 19__. (Applies only to Regular,
Spousal and SEP IRAs. Current year if not marked)
Xxxxx Treasury Only Money Xxxxx Intermediate Treasury
Market Fund $_______ Fund $_______
Xxxxx Bond Fund $_______
4. BENEFICIARY DESIGNATION
Complete this section to designate Primary and Contingent Beneficiary(ies)
to receive, in the event of your death, any benefits which may be payable
under your IRA. A beneficiary must survive you to receive anything. If your
Primary Beneficiary(ies) do not survive you, your Contingent
Beneficiary(ies) will receive the funds. If more than one person is named
and no percentage is indicated, a joint tenancy with the right of
survivorship will be deemed to have been created. If the beneficiary is a
trust, please indicate the date of the trust and the trustee(s) name. You
may change your beneficiaries at any time by giving written notice to the
Custodian.
Depositor's Designation: In event of my death, I hereby designate the
following individuals as the Primary and Contingent Beneficiary(ies) to
receive all benefits that may become due and payable under my Xxxxx
Treasury Funds IRA.
Consent of Depositor's Spouse: Spousal consent is required in community
property and marital property states where an IRA Depositor wishes to name
a beneficiary other than, or in addition to, the spouse. Spouses of
Depositors who reside in community property or marital property states (AZ,
CA, ID, LA, NV, NM, TX, WA, WI) must sign the consent below.
I hereby consent to and join in the designation of beneficiary below. I
give to the Depositor any interest I have in the funds deposited in this
account.
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Signature of Depositor's Spouse (if applicable) Date
PRIMARY BENEFICIARY(IES):___ PLEASE CHECK HERE IF YOU HAVE ATTACHED A
SEPARATE SHEET WITH ADDITIONAL PRIMARY BENEFICIARY(IES). SIGN AND DATE THE
SHEET.
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Name % of Distribution Name % of Distribution
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Street Street
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City State Zip Code City State Zip Code
( ) ( )
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Taxpayer Identification Taxpayer Identification
No. Telephone No. Telephone
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Birthdate Relationship Birthdate Relationship
3
CONTINGENT BENEFICIARIES: PLEASE CHECK HERE IF YOU HAVE ATTACHED A
SEPARATE SHEET WITH ADDITIONAL CONTINGENT BENEFICIARY(IES). SIGN AND DATE
THE SHEET.
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Name % of Distribution Name % of Distribution
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Street Street
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City State Zip Code City State Zip Code
( ) ( )
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Taxpayer Identification Taxpayer Identification
No. Telephone No. Telephone
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Birthdate Relationship Birthdate Relationship
5. TERMS AND CONDITIONS OF THE XXXXX XXX ADOPTION AGREEMENT
Please sign and date this Application and Adoption Agreement. If you are
also establishing a Spousal IRA, be sure to have your spouse sign and date
as well. You, the Depositor, acknowledge that you have received and read
the current Prospectus for each Fund which you have designated for
investment.
All subsequent contributions will be invested as indicated by you in the
"Investment" section of this form. All dividends and distributions from the
Fund shares held in your Account will be reinvested in shares of the Fund
from which received. The Custodian, upon written instructions from you, may
exchange any Xxxxx Fund shares for any other Xxxxx Fund shares in
accordance with the then-current prospectus.
CUSTODIAL FEES: $10 ANNUAL MAINTENANCE FEE PER ACCOUNT.
The annual maintenance fee may be paid by the Depositor in addition to the
maximum annual contribution to his or her IRA. If the fee is not included,
the Custodian will deduct the fee from the Account at year-end or at the
time the Account is closed. The Custodian reserves the right to change the
Custodian fee, but will give at least 30 days written notice to the
Depositor of any fee changes. The Custodian will keep records, identify and
file returns and provide other information concerning your Account as
required by the Internal Revenue Code and any Regulations issued or forms
adopted by the Treasury Department of the United States.
I (THE DEPOSITOR) HEREBY ESTABLISH AN IRA UNDER THE TERMS AND CONDITIONS
CONTAINED IN THE ACCOMPANYING CUSTODIAL ACCOUNT AGREEMENT, WHICH IS
INCORPORATED HEREIN BY REFERENCE. THE COMBINED INSTRUMENT IS HEREINAFTER
REFERRED TO AS THE "AGREEMENT." THIS IRA BECOMES EFFECTIVE UPON WRITTEN
ACCEPTANCE OF THIS APPLICATION AND ADOPTION AGREEMENT BY THE CUSTODIAN, PNC
BANK, NATIONAL ASSOCIATION, WHICH WRITTEN ACCEPTANCE SHALL CONSIST OF A
CONFIRMATION OF TRANSACTION STATEMENT ISSUED BY THE CUSTODIAN. THE
DEPOSITOR UNDERSTANDS AND AGREES THAT THE CUSTODIAN IS NOT RESPONSIBLE FOR
ANY ASSETS UNTIL RECEIVED.
I (THE DEPOSITOR) CERTIFY UNDER THE PENALTIES OF PERJURY THAT MY SOCIAL
SECURITY NUMBER IS TRUE, CORRECT AND COMPLETE AND THAT THIS NUMBER IS MY
TAXPAYER IDENTIFICATION NUMBER.
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Signature Date
Accepted: PNC Bank, National Association, C/O PFPC Inc., 000 Xxxxxxxx
Xxxxxxx, Xxxxxxxxxx, XX 00000
By:
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Authorized Representative of Custodian Date
Distributor: Xxxxx Treasury Funds, Inc.
Shares of the Funds are offered by the Distributor. The Distributor is not
a bank, and shares of the Fund are not deposits or obligations of, or
guaranteed or endorsed by, any bank nor are they federally insured or
otherwise supported by the FDIC, the Federal Reserve Board or any other
agency.
4
TRANSFER AUTHORIZATION FORM
Use this form to transfer amounts from your current IRA or qualified
retirement plan directly to this IRA. (NOTE: A direct transfer from a
qualified plan to your IRA will avoid the IRS mandatory 20% withholding
requirement.)
1.DEPOSITOR NAME AND ADDRESS
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Depositor's Name Spouse's name (if transferring a
Spousal IRA)
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Address
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City State Zip Code
( ) ( )
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Home Phone Work Phone
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Depositor's Social Security Number Spouse's Social Security Number
2. PLEASE TELL US ABOUT YOUR PRESENT IRA OR RETIREMENT PLAN
Type of account to be transferred:
__ Individual IRA __ Spousal IRA __ Qualified Retirement Plan
__ 403(b) Plan Arrangement __ SEP--IRA __ Other ______________
Transfer from: (Please complete entirely. For more information or questions
about your retirement plan, contact your employer's benefits or personnel
department.)
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Account Number Account Registration
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Name of Present Trustee/Custodian Name of Employer (if applicable)
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Street of Present Trustee/Custodian Plan Name (if applicable)
( )
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City State Zip Code Telephone
3. PLEASE TELL US HOW TO INVEST YOUR IRA OR QUALIFIED RETIREMENT PLAN ASSETS
PLEASE NOTE: If you have deductible and nondeductible IRA contributions,
you may wish to invest in separate accounts. While these funds may be
commingled in a single account, separate accounts may facilitate the
keeping of appropriate records. Also please note that if you commingle a
qualified plan rollover with annual IRA contributions, you will not be
eligible to rollover the amount to another qualified plan in the future.
Transfer to: (Please check one of the following.)
A. __ I am opening a new account and have attached a completed Application.
B. __ Please deposit proceeds in my existing IRA. Complete information
below:
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Existing IRA Account Name Fund Name(s) Account Number
4. IF YOU ARE AGE 70 1/2 OR OLDER, COMPLETE THE FOLLOWING
Required Minimum Distribution has been taken for the current tax
year: ___ Yes ___ No
Current Election Is:
___ Single life non-recalculated
___ Single life recalculated
___ Joint life non-recalculated (Please fill out beneficiary information
below if you checked this item)
___ Joint life recalculated (Please fill out beneficiary information below
if you checked this item)
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Beneficiary name Beneficiary date of birth Beneficiary relationship
5
5. PLEASE AUTHORIZE YOUR PRESENT TRUSTEE OR CUSTODIAN TO TRANSFER YOUR
RETIREMENT PLAN OR YOUR IRA ASSETS TO THE IRA CUSTODIAN--PNC BANK, NATIONAL
ASSOCIATION
To Present Trustee or Custodian:
Please liquidate ___ all or part ($_______) of the account listed in Section 2
above and transfer the proceeds of liquidation ("cash" only, by check,
draft, wire transfer or other form acceptable to the receiving Custodian)
to my new Xxxxx Treasury Funds IRA Custodian--PNC Bank, National
Association.
I have appointed PNC Bank, National Association as Custodian of my Xxxxx
Treasury Funds IRA and authorize you to transfer amounts as indicated above
to the new Custodian. Please send the new Custodian any documents or
records needed to complete the transfer. I understand that I am responsible
for the transfer of all assets to my successor IRA, and that PNC Bank,
National Association, and PFPC Inc. have no duty to enforce the collection
of any assets to be transferred to my Xxxxx Treasury Funds IRA.
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Your Signature Date
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Signature Guarantee (if required*) Date
* Your present trustee or custodian may require your signature to be
guaranteed. Please call them for requirements; the lack of a required
signature guarantee could delay your transfer.
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FOR CUSTODIAN USE ONLY
AUTHORIZED ACCEPTANCE OF PLAN TO BE COMPLETED BY PNC BANK, NATIONAL
ASSOCIATION--CUSTODIAN
PNC Bank, National Association, as IRA Custodian, will accept the transfer
of assets of the account specified in Item 2 above into an Individual
Retirement Account qualified under the Internal Revenue Code and
established for the benefit of the Depositor named below.
--------------------- ---------------- ---------------------
Depositor's Name Account Number Account Number
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Authorized Representative of PNC Bank, National Association Date Telephone
Number
Please indicate Xxxxx Treasury Funds IRA Account Number(s) on all documents
sent to us. Please forward a copy of this form with the transfer proceeds
for proper account identification. If any of the funds represent
contributions for the current calendar year, please specify said amounts.
Make check payable and forward with a copy of this Transfer Authorization
Form to:
Xxxxx Treasury Funds
Attn: Retirement Plans
FBO: ______________ Xxxxx Treasury Funds IRA Account Number: _______________
c/o PFPC INC.
P.O. Box 8969
Wilmington, DE 19899-8969
6
ROLLOVER CERTIFICATION FORM
Use this form to rollover a distribution from your current IRA or eligible
distribution from a qualified retirement plan to your Xxxxx Treasury Funds
IRA. You must complete the rollover within 60 calendar days of your receipt of
that distribution.
PLEASE NOTE: 20% withholding is required on any eligible rollover distribution
from a qualified retirement plan unless the distribution is transferred
directly to an IRA or other qualified plan. To transfer your distribution
directly, please complete the "Transfer Authorization Form" included with this
Application.
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Name of Depositor (Contributor) Social Security Number
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Distributing IRA Name Distributing Qualified Plan Name
OR
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Distributing IRA Account Number Distributing Qualified Plan Account
Number
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
1. TYPE OF ROLLOVER CONTRIBUTION (PLEASE CHECK ONE.)
-- XXX Xxxxxxxx--Note that 365 days must have passed since you last
received a rollover distribution from the distributing IRA.
-- Eligible Rollover Distribution--A distribution from a qualified
retirement plan of all or part of your plan balance, other than the
portion of any distribution which is nontaxable. Your employer's
benefits or personnel office should be able to tell you what portion of
your distribution is an "eligible distribution".
-- Qualified Domestic Relations Order Distribution.
2. 70 1/2 ROLLOVER RESTRICTIONS (PLEASE CHECK ONE.)
-- I am not nor will be 70 1/2 or older in this calendar year.
-- I am or will be 70 1/2 or older in this calendar year. I understand that
I may not rollover any amounts required to be distributed under Internal
Revenue Code Sections 408(a)(6) and 401(a)(9).
3. CERTIFICATION
I certify that the contribution described above is an eligible IRA rollover
contribution and that I am rolling over this contribution within 60 calendar
days of my receipt of that distribution. I understand that this rollover is
irrevocable and involves important tax considerations. Specifically, I
understand that a rollover contribution from a qualified retirement plan will
no longer be eligible for the special averaging, capital gains and separate
tax treatment that may be available for distributions from such plans. Other
tax considerations may also apply.
I agree that I am solely responsible for all tax consequences of this
rollover contribution. I also agree that the IRA custodian shall have no
responsibility for any tax consequences.
I understand that if I commingle a qualified retirement plan rollover with
annual IRA contributions, I will not be eligible to rollover the amount to
another qualified plan in the future. Other restrictions regarding subsequent
rollovers of this contribution may also apply.
I HAVE READ AND UNDERSTAND AND AGREE TO BE LEGALLY BOUND BY THE TERMS OF THIS
FORM. I ALSO UNDERSTAND THAT THE IRA CUSTODIAN WILL RELY ON THIS FORM WHEN
ACCEPTING MY ROLLOVER CONTRIBUTION. I UNDERSTAND THAT THIS ROLLOVER IS
IRREVOCABLE AND MAY NOT BE REVERSED IN THE FUTURE. I ALSO UNDERSTAND THAT I
AM RESPONSIBLE FOR THE MOVEMENT OF THE ROLLOVER TO MY SUCCESSOR IRA, AND THAT
PNC BANK, NATIONAL ASSOCIATION AND PFPC INC. HAVE NO DUTY TO ENFORCE THE
COLLECTION OF ANY ASSETS TO BE ROLLED OVER TO MY XXXXX TREASURY FUNDS IRA.
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Depositor's Signature Date
7
INDIVIDUAL RETIREMENT ACCOUNT
DISCLOSURE STATEMENT
The following information is the disclosure statement required by Federal Tax
regulations. You should read this disclosure statement, the custodial account
Agreement, and the prospectuses for the Funds in which your Xxxxx Treasury
Funds Individual Retirement Account (IRA) contributions will be invested.
REVOCATION OF YOUR IRA
You have the right to revoke your Xxxxx Treasury Funds IRA and receive the
entire amount of your contribution by notifying PNC Bank, National
Association, the Custodian of your Xxxxx Treasury Funds IRA, in writing
within seven (7) days of establishment of your IRA. If you revoke your IRA
within seven days, you are entitled to a return of the entire amount paid
by you, without adjustment for such items as sales commission,
administrative expenses, or fluctuations in market value. If you decide to
revoke your IRA, notice should be delivered or mailed to:
REGULAR MAIL: OVERNIGHT EXPRESS:
PNC Bank, National Association PNC Bank, National Association
c/o PFPC Inc. c/o PFPC Inc.
Attn: Xxxxx Treasury Funds IRA Attn: Xxxxx Treasury Funds IRA
P.O. Box 8969 000 Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000-0000 Xxxxxxxxxx, XX 19809
0-000-000-0000
This notice should be signed by you and include the following:
1. The date;
2. A statement that you elect to revoke your Xxxxx Treasury Funds IRA;
3. Your Xxxxx Treasury Funds IRA account number;
4. The date your Xxxxx Treasury Funds IRA was established;
5. Your signature and your printed or typed name.
Mailed notice will be deemed given on the date that it is postmarked, if it
is deposited in the United States mail, first class postage prepaid and
properly addressed. This means that if you mail your notice it must be
postmarked on or before the seventh day after your Xxxxx Treasury Funds IRA
was opened. A revoked IRA will be reported to the Internal Revenue Service
and the Depositor on Forms 1099-R and 5498.
YOUR INDIVIDUAL RETIREMENT ACCOUNT (IRA)
You have opened a Xxxxx Treasury Funds Individual Retirement Account which
is an account for the exclusive benefit of you and your beneficiaries,
created by a written instrument (the Custodial Account Agreement). The
following requirements apply to your Xxxxx Treasury Funds IRA:
1. Contributions, transfers, and rollovers may be made only in "cash" by
check, draft, wire transfer, or other form acceptable to the
Custodian;
2. The Custodian must be a bank;
3. No part may be invested in life insurance;
4. Your interest must be nonforfeitable (not subject to escheat laws);
5. The assets of the custodial account may not be mixed with other
property except in a common investment fund; and
6. You must begin receiving distributions from your account no later than
April 1 of the year following the year in which you become 70 1/2
years old; and distribution must be completed over a period that is
not longer than the joint life expectancy of you and your beneficiary.
8
CONTRIBUTIONS
You may not contribute more than 100% of your compensation or earnings from
self-employment, and the maximum contribution is $2,000 per tax year. If
your spouse is not employed or elects for IRA purposes to be treated as
having no compensation, you may also contribute to a Spousal IRA, but the
total contribution for both of you may not exceed $2,250 per tax year. The
total ($2,250) may be divided between the accounts for you and your spouse
in any manner, except that not more than $2,000 may be contributed to
either account.
EXCESS CONTRIBUTIONS
Amounts contributed to your Xxxxx Treasury Funds IRA in excess of the
allowable limit will be subject to a nondeductible excise tax of 6% for
each year until the excess is used up as an allowable contribution (in a
subsequent year) or returned to you. A distribution of excess contributions
must be included in your taxable income when distributed, and may also be
subject to the 10% excise tax on early distributions discussed below. The
6% excise tax will not apply if the excess contribution and earnings
applicable to it are distributed by the due date for your Federal Income
Tax Return, including extensions. If such a distribution is made by the due
date of your tax return, only the earnings are taxable (of course, the
excess contribution will not be deductible).
INCOME TAX DEDUCTION
Your contribution may be deductible on your Federal Income Tax Return.
However, there is a phase-out of the IRA deduction if either you or your
spouse (if you file a joint return) is an active participant in an
employer-sponsored retirement plan. The IRA deduction is reduced
proportionately as adjusted gross income increases from $25,000 to $35,000
for a single individual, $40,000 to $50,000 for a married couple filing a
joint return, or from $0 to $10,000 for a married individual who is an
active participant and files a separate return. The amount of the reduction
is equal to 20% of the amount by which your adjusted gross income exceeds
the $25,000, $40,000, and $0 amounts, respectively. Your contributions in
excess of the permitted deduction will be nondeductible contributions.
TAXATION OF DISTRIBUTIONS
The income of your Xxxxx Treasury Funds IRA is not taxed until the money is
distributed to you. Distributions are taxable as ordinary income when
received except that the amount of any distribution representing non-
deductible contributions is not taxed.
In general, you may "rollover" a distribution from another IRA, an eligible
rollover distribution from your employer's qualified plan, or distributions
from certain tax deferred annuities or accounts. If a distribution is
rolled over, i.e. deposited to your Xxxxx Treasury Funds IRA within 60
calendar days of receipt, the amount rolled over is not taxable. The IRS
enforces the 60-day time limit strictly. You may rollover a portion of a
distribution in which case the remainder will be subject to tax. The IRS
requires that distributions from your employer's qualified plan have 20% of
the distribution withheld for income tax unless your money is transferred
in a direct asset transfer to an eligible retirement plan such as another
qualified plan or IRA. The rules regarding rollovers are complex and you
should consult your tax adviser prior to rolling over all or part of a
distribution.
PENALTY TAX ON CERTAIN TRANSACTIONS
EXCESS CONTRIBUTIONS
If you make an excess contribution to your IRA and it is not corrected on a
timely basis, an excise tax of 6% is imposed on the excess amount. This tax
will apply each year to any part or all of the excess which remains in your
account.
9
EARLY DISTRIBUTIONS
Your receipt or use of any portion of your account before you attain age 59
1/2 is considered an early distribution unless the distribution is a result
of death or disability or is rolled over. The amount of any early taxable
distribution (excluding any amount representing a return of nondeductible
contributions) is subject to a penalty tax equal to 10% of the
distribution. A pre-age 59 1/2 taxable distribution will be exempt from the
10% penalty tax if, for example, it is part of a scheduled series of
substantially equal payments over your life, or over the joint life
expectancy of you and a beneficiary, or if it was made because you became
disabled. If you request a distribution in the form of a series of
substantially equal payments, and you modify the payments before 5 years
have elapsed and before attaining age 59 1/2, the 10% additional income tax
will apply retroactively to the year payments began through the year of
such modification. This 10% penalty is in addition to any Federal income
tax that is owed at distribution.
REQUIRED DISTRIBUTIONS
You are required to begin receiving minimum distributions from your IRA no
later than April 1 following the calendar year in which you reach the age
of 70 1/2. The distribution may be paid either in installments, or in a
lump sum. The installments may be paid over a period not to exceed your
life expectancy, or over the joint and last survivor life expectancy of you
and your designated beneficiary. If the amount distributed during a taxable
year is less than the minimum amount required to be distributed, the
recipient is subject to a penalty tax equal to 50% of the difference
between the amount distributed and the amount required to be distributed.
EXCESS DISTRIBUTIONS
If you receive more than the greater of $112,500 (subject to annual cost-
of-living adjustments) or $150,000 in a calendar year from certain
retirement plans, a 15% tax is imposed on the amount in excess of that
amount. (Special rules may apply to benefits accumulated prior to August 1,
1986.) All distributions from IRAs, qualified retirement plans, and tax-
sheltered annuities must be added together for purposes of this excise tax.
There are several possible favorable elections that may reduce or eliminate
this tax. The rules are very complicated. You should consult a competent
tax adviser.
ADDITIONAL INFORMATION ON DISTRIBUTIONS
An IRA distribution request form is available from the Custodian, and
should be obtained and used to request any distribution from your IRA.
PROHIBITED TRANSACTIONS
If you or your beneficiary engage in any prohibited transaction (such as
any sale, exchange, borrowing, or leasing of any property between you and
the account; or any other interference with the independent status of the
account), the account will lose its exemption from tax and be treated as
having been distributed to you. The value of the entire account will be
includable in your gross income. If you are under age 59 1/2, you would
also be subject to the 10% penalty tax on early distributions.
If you or your beneficiary use (pledge) all or any part of your IRA as
security for a loan, then the portion so pledged will be treated as if
distributed to you, and will be taxable to you as ordinary income, and
subject to a 10% penalty tax if you have not attained age 59 1/2 during the
year which you make such a pledge.
10
INCOME TAX WITHHOLDING
The Custodian is required to withhold income tax from any distribution from
your IRA to you at the rate of 10% unless you choose not to have tax
withheld. You may elect out of withholding by advising the Custodian in
writing, prior to the distribution, that you do not want tax withheld from
the distribution. This election may be made on IRS Form W-4P, or any other
form acceptable to the Custodian. If you do not elect out of tax
withholding, you may direct the Custodian to withhold an additional amount
of tax in excess of 10%.
ADDITIONAL INFORMATION
For more detailed information, you may obtain Publication 590, Individual
Retirement Arrangements (IRAs) from any district office of the Internal
Revenue Service or by calling 0-000-XXX-XXXX.
Any IRA transaction may have tax consequences; consult your tax adviser to
obtain information about the tax consequences in connection with your
particular circumstances.
INFORMATION ABOUT YOUR INVESTMENTS
A mutual fund investment involves investment risks, including possible loss
of principal. In addition, growth in the value of your account is neither
guaranteed nor projected due to the characteristics of a mutual fund
investment. Detailed information about the shares of each mutual fund
available for investment by your Xxxxx Treasury Funds IRA must be furnished
to you in the form of a prospectus. The method for computing and allocating
annual earnings is set forth in the prospectus. (See prospectus section
entitled "Dividends and Distributions.") If you made an initial
contribution of $1,000 on the first day of a calendar year and no further
investment during that year, your contribution would also be subject to
certain costs and expenses which would reduce any yield you might obtain
from your investment. (See the prospectus section entitled "Expense
Information" and the sections referred to therein.) For further information
regarding expenses, earnings, and distributions, see the fund's financial
statements, prospectus and/or statement of additional information.
FEES AND CHARGES
The charges in connection with your Xxxxx Treasury Funds IRA are set forth
in the Application. The Custodian may also charge a service fee in
connection with any distribution from your IRA.
IRS APPROVED FORM
Your Xxxxx Treasury Funds IRA is the Internal Revenue Service's model
custodial account contained in IRS Form 5305-A. Certain additions have been
added in Article VIII of the form. By following this form, your Xxxxx
Treasury Funds IRA meets the requirements of the Internal Revenue Code.
However, the IRS has not endorsed the merits of the investments allowed
under the IRA. Form 5305-A may also be used by qualifying employers in
conjunction with Form 5305-SEP to establish a simplified employee pension
plan (SEP) on behalf of employees. If your IRA is part of a SEP, details
regarding SEPs should also be provided by your employer.
11
CUSTODIAL ACCOUNT AGREEMENT
(UNDER SECTION 408(A) OF THE INTERNAL REVENUE CODE--FORM 5305-A (REVISED
OCTOBER 1992))
The Depositor (Contributor) whose name appears in the accompanying Application
is establishing an Individual Retirement Account (IRA) (under section 408(a)
of the Internal Revenue Code of 1986, as amended, the "Code") to provide for
his or her retirement and for the support of his or her beneficiary(ies) after
death. The Custodian, PNC Bank, National Association, has given the Depositor
the disclosure statement required under Treasury Regulations section 1.408-6.
The Depositor and the Custodian make the following agreement:
ARTICLE I
The Custodian may accept additional cash contributions on behalf of the
Depositor for a tax year of the Depositor. The total cash contributions are
limited to $2,000 for the tax year unless the contribution is a rollover
contribution described in section 402(c) (but only after December 31,
1992), 403(a)(4), 403(b)(8), 408(d)(3), or an employer contribution to a
simplified employee pension plan as described in section 408(k). Rollover
contributions before January 1, 1993, include rollovers described in
section 402(a)(5), 402(a)(6), 402(a)(7), 403(a)(4), 403(b)(8), 408(d)(3),
or an employer contribution to a simplified employee pension plan as
described in section 408(k).
ARTICLE II
The Depositor's interest in the balance in the custodial account is
nonforfeitable.
ARTICLE III
1. No part of the custodial funds may be invested in life insurance
contracts, nor may the assets of the custodial account be commingled
with other property except in a common trust fund or common investment
fund (within the meaning of section 408(a)(5)).
2. No part of the custodial funds may be invested in collectibles (within
the meaning of section 408(m)) except as otherwise permitted by section
408(m)(3) which provides an exception for certain gold and silver coins
and coins issued under the laws of any state.
ARTICLE IV
1. Notwithstanding any provision of this agreement to the contrary, the
distribution of the Depositor's interest in the custodial account shall
be made in accordance with the following requirements and shall
otherwise comply with section 408(a)(6) and Proposed Regulations section
1.408-8, including the incidental death benefit provisions of Proposed
Regulations section 1.401(a)(9)-2, the provisions of which are
incorporated by reference.
2. Unless otherwise elected by the time distributions are required to begin
to the Depositor under paragraph 3, or to the surviving spouse under
paragraph 4, other than in the case of a life annuity, life expectancies
shall be recalculated annually. Such election shall be irrevocable as to
the Depositor and the surviving spouse and shall apply to all subsequent
years. The life expectancy of a nonspouse beneficiary may not be
recalculated.
3. The Depositor's entire interest in the custodial account must be, or
begin to be, distributed by the Depositor's required beginning date
(April 1 following the calendar year end in which
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the Depositor reaches age 70 1/2). By that date, the Depositor may
elect, in a manner acceptable to the Custodian, to have the balance in
the custodial account distributed in:
(a) A single sum payment.
(b) An annuity contract that provides equal or substantially equal
monthly, quarterly, or annual payments over the life of the
Depositor.
(c) An annuity contract that provides equal or substantially equal
monthly, quarterly, or annual payments over the joint and last
survivor lives of the Depositor and his or her designated
beneficiary.
(d) Equal or substantially equal annual payments over a specified
period that may not be longer than the Depositor's life expectancy.
(e) Equal or substantially equal annual payments over a specified
period that may not be longer than the joint life and last survivor
expectancy of the Depositor and his or her designated beneficiary.
4. If the Depositor dies before his or her entire interest is distributed
to him or her, the entire remaining interest will be distributed as
follows:
(a) If the Depositor dies on or after distribution of his or her
interest has begun, distribution must continue to be made in
accordance with paragraph 3.
(b) If the Depositor dies before distribution of his or her interest
has begun, the entire remaining interest will, at the election of
the Depositor or, if the Depositor has not so elected, at the
election of the beneficiary or beneficiaries, either
(i) Be distributed by the December 31 of the year containing the
fifth anniversary of the Depositor's death, or
(ii) Be distributed in equal or substantially equal payments over
the life or life expectancy of the designated beneficiary or
beneficiaries starting by December 31 of the year following
the year of the Depositor's death. If, however, the
beneficiary is the Depositor's surviving spouse, then this
distribution is not required to begin before December 31 of
the year in which the Depositor would have turned age 70 1/2.
(c) Except where distribution in the form of an annuity meeting the
requirements of section 408(b)(3) and its related regulations has
irrevocably commenced, distributions are treated as having begun on
the Depositor's required beginning date, even though payments may
actually have been made before that date.
(d) If the Depositor dies before his or her entire interest has been
distributed and if the beneficiary is other than the surviving
spouse, no additional cash contributions or rollover contributions
may be accepted in the account.
5. In the case of a distribution over life expectancy in equal or
substantially equal annual payments, to determine the minimum annual
payment for each year, divide the Depositor's entire interest in the
Custodial account as of the close of business on December 31 of the
preceding year by the life expectancy of the Depositor (or the joint
life and last survivor expectancy of the Depositor and the Depositor's
designated beneficiary, or the life expectancy of the designated
beneficiary, whichever applies). In the case of distributions under
paragraph 3, determine the initial life expectancy (or joint life and
last survivor expectancy) using the attained ages of the Depositor and
designated beneficiary as of their
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birthdays in the year the Depositor reaches age 70 1/2. In the case of a
distribution in accordance with paragraph 4(b)(ii) determine life
expectancy using the attained age of the designated beneficiary as of
the beneficiary's birthday in the year distributions are required to
commence.
6. The owner of two or more individual retirement accounts may use the
"alternative method" described in Notice 88-38, 1988-1 C.B. 524, to
satisfy the minimum distribution requirements described above. This
method permits an individual to satisfy these requirements by taking
from one individual retirement account the amount required to satisfy
the requirement for another.
ARTICLE V
1. The Depositor agrees to provide the Custodian with information necessary
for the Custodian to prepare any reports required under section 408(i)
and Regulations section 1.408-5 and 1.408-6.
2. The Custodian agrees to submit reports to the Internal Revenue Service
and the Depositor prescribed by the Internal Revenue Service.
ARTICLE VI
Notwithstanding any other articles which may be added or incorporated, the
provisions of Article I through III and this sentence will be controlling.
Any additional articles that are not consistent with section 408(a) and the
related regulations will be invalid.
ARTICLE VII
This agreement will be amended from time to time to comply with the
provision of the Code and related regulations. Other amendments may be made
with the consent of the Depositor and the Custodian.
ARTICLE VIII
1. All funds in the custodial account (including earnings) shall be
invested in shares of beneficial interest of any one or more of the
regulated investment companies managed by the company listed on the
Application Form contained in this package or any of its subsidiaries or
affiliates, and which have been designated by such company as eligible
for investment under this custodial account, which investment companies
shall be collectively referred to as "the Funds" and which shares shall
be collectively referred to as "Fund Shares". Fund Shares shall be
purchased at the public offering value for Fund Shares next to be
determined after receipt of the contribution by the Custodian or its
agent.
2. The shareholder of record of all Fund Shares shall be the Custodian or
its nominee.
3. The Depositor shall, from time to time, direct the Custodian to invest
the funds of his/her custodian account in Fund Shares. Any funds which
are not directed as to investment will be returned to the Depositor
without being deemed to have been contributed to his/her custodial
account. The Depositor shall be the beneficial owner of all Fund Shares
held in the custodial account, and the Custodian shall not vote any such
shares except upon written direction of the Depositor.
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4. The Custodian agrees to forward, or to cause to be forwarded, to every
Depositor the then-current prospectus(es) of the Funds, as applicable,
which have been designated by the Custodian as eligible for investment
under the custodial account and selected by the Depositor for such
investment, and all notices, proxies and related proxy soliciting
materials applicable to said Fund Shares received by it.
5. Each Depositor shall have the right by written notice to the Custodian
to designate or to change a beneficiary to receive any benefit to which
such Depositor may be entitled in the event of his/her death prior to
the complete distribution of such benefit. If no such designation is in
effect on the Depositor's death, or if the designated beneficiary has
predeceased the Depositor, the beneficiary shall be the Depositor's
estate.
6. (a) The Custodian shall have the right to receive rollover contributions
as described in Article I of this Agreement. The Custodian reserves
the right to refuse to accept any property which is not in the form
of cash.
(b) The Custodian, upon written direction of the Depositor and after
submission to the Custodian of such documents as it may reasonably
require, shall transfer the assets held under this Agreement (reduced
by (1) any amounts referred to in paragraph 8 of this Article VIII and
(2) any amounts required to be distributed during the calendar year of
transfer) to a qualified retirement plan, to a successor individual
retirement account, to an individual retirement annuity for the
Depositor's benefit, or directly to the Depositor. Any amounts received
or transferred by the Custodian under this paragraph 6 shall be
accompanied by such records and other documents as the Custodian deems
necessary to establish the nature, value and extent of the assets and
of the various interests therein.
7. Without in any way limiting the foregoing, the Depositor hereby
irrevocably delegates to the Custodian the right and power to amend at
any time and from time to time the terms and provisions of this
Agreement and hereby consents to such amendments, provided they shall
comply with all applicable provisions of the Code, the Treasury
regulations thereunder and with any other governmental law, regulation
or ruling. Any such amendments shall be effective when the notice of
such amendments is mailed to the address of the Depositor indicated by
the Custodian's records.
8. Any income taxes or other taxes of any kind whatsoever levied or
assessed upon or in respect of the assets of the custodial account or
the income arising therefrom, any transfer taxes incurred, all other
administrative expenses incurred, all other administrative expenses
incurred by the Custodian in the performance of its duties including
fees for legal services rendered to the Custodian, and the Custodian's
compensation may be paid by the Depositor and, unless so paid within
such time period as the Custodian may establish, shall be paid from the
Depositor's custodial account. The Custodian reserves the right to
change or adjust its compensation upon 30 days advance notice to the
Depositor.
9. The benefits provided hereunder shall not be subject to alienation,
assignment, garnishment, attachment, execution or levy of any kind, and
any attempt to cause such benefits to be so subjected shall not be
recognized, except to such extent as may be required by law.
10. The Custodian may rely upon any statement by the Depositor when taking
any action or determining any fact or question which may arise under
this Custodial Agreement. The Depositor hereby agrees that the
Custodian will not be liable for any loss or expense resulting from any
action taken or determination made in reliance on such statement. The
Depositor assumes sole responsibility for assuring that contributions
to the custodial account satisfy the limits specified in the
appropriate provisions of the Code.
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11. The Custodian may resign at any time upon 30 days written notice to the
Depositor and may be removed by the Depositor at any time upon 30 days
written notice to the Custodian. Upon the resignation or removal of the
Custodian, a successor Xxxxxxxxx shall be appointed within 30 days of
such resignation notice and in the absence of such appointment, the
Custodian shall appoint a successor unless the Agreement be sooner
terminated. Any successor Custodian shall be a bank (as defined in
section 408(n) of the Code) or such other person found qualified to act
as a Custodian under an individual account plan by the Secretary of the
Treasury or his delegate. The appointment of a successor Xxxxxxxxx
shall be effective upon receipt by the Custodian of such successor's
written acceptance which shall be submitted to the Custodian and the
Depositor. Within 30 days of the effective date of a successor
Xxxxxxxxx's appointment, the Custodian shall transfer and deliver to
the successor Custodian applicable account records and assets of the
custodial account (reduced by any unpaid amounts referred to in
paragraph 8 of this Article VIII). The successor Custodian shall be
subject to the provisions of this Agreement (or any successor thereto)
on the effective date of its appointment.
12. Notwithstanding any provision hereof to the contrary, for taxable years
in which contributions to the custodial account are to qualify as
contributions to a Spousal Individual Retirement Account, the following
provisions shall apply: a separate custodial account shall be
established under this Agreement in the name of the spouse, who shall
thereafter be deemed to be the Depositor with respect to such separate
custodial account. The sum of the amount contributed to the custodial
account of the Depositor and the Depositor's spouse for a given tax
year shall not exceed the lesser of:
(i) An amount equal to 100% of the compensation (including earned
income in the case of a self-employed individual) includable in the
employed spouse's gross income for the taxable year or
(ii) $2,250, provided, however, that no more than $2,000 may be
contributed to either of such custodial accounts.
13. The Custodian shall, from time to time, in accordance with instructions
in writing from the Depositor, make distributions out of the custodial
account to the Depositor in the manner and amounts as may be specified
in such instructions (reduced by any amounts referred to in Article
VIII, paragraph 8). An IRA distribution request form is available from
the Custodian, and should be obtained and used to request any
distribution from your IRA. Notwithstanding the provisions of Article
IV above, the Custodian assumes (and shall have) no responsibility to
make any distribution to the Depositor (or the Depositor's beneficiary
if the Depositor is deceased) unless and until such written
instructions specify the occasion for such distribution and the elected
manner of distribution, except as set forth in the second part of this
paragraph (13) below, with respect to age 70 1/2 distributions. Prior
to making any such distribution from the custodial account, the
Custodian shall be furnished with any and all applications,
certificates, tax waivers, signature guarantees, and other documents
(including proof of any legal representative's authority) deemed
necessary or advisable by the Custodian, but the Custodian shall not be
liable for complying with written instructions which appear on their
face to be genuine, or for refusing to comply if not satisfied such
instructions are genuine, and assumes no duty of further inquiry. Upon
receipt of proper written instructions as required above, the Custodian
shall cause the assets of the custodial account to be distributed in
cash and/or in kind, as specified in such written order.
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The Depositor may select as a method of distribution under Article IV,
paragraph 3, option (a), (d), or (e); but may not select option (b) or
(c), notwithstanding description of such in Article IV. If the Depositor
requests age 70 1/2 distribution by timely written instruction but does
not choose any of the methods of distribution described above by the April
1st following the calendar year in which he or she reaches age 70 1/2,
distribution to the Depositor will be made in accordance with Article IV,
paragraph 3, option (d). If the Depositor does not request age 70 1/2
distribution from the custodial account by timely written instruction, or
does not specify a method of calculating the amount of the age 70 1/2
distribution which the Depositor will be taking from another IRA(s),
calculation of the current year Required Minimum Distribution amount which
can not be transferred or rolled over to another IRA will be made in
accordance with Article IV, paragraph 3, option (d).
14. Distribution of the assets of the custodial account shall be made in
accordance with the provisions of Article IV as the Depositor (or the
Depositor's beneficiary if the Depositor is deceased) shall elect by
written instructions to the Custodian; subject, however, to the
provisions of sections 401(a)(9), 408(a)(6) and 403(b)(10) of the Code,
the regulations promulgated thereunder, and the following:
(i) The recalculation of life expectancy of the Depositor and/or the
Depositor's spouse may be made only at the written election of the
Depositor. The recalculation of life expectancy of the surviving
spouse shall only be made at the written election of the surviving
spouse.
(ii) If the Depositor dies before his/her entire interest in the
custodial account has been distributed, and if the designated
beneficiary of the Depositor is the Depositor's surviving spouse,
the spouse may treat the custodial account as his/her own
individual retirement arrangement. This election will be deemed to
have been made if the surviving spouse makes a regular IRA
contribution to the custodial account, makes a rollover to or from
such custodial account, or fails to receive a payment from the
custodial account within the appropriate time period applicable to
the deceased Depositor under section 401(a)(9)(B) of the Code.
(iii) With respect to distributions in calendar years beginning in or
after 1989, if the Depositor's designated beneficiary is not
his/her spouse, then distributions to the Depositor and his/her
beneficiary commencing with the Depositor's required beginning
date shall comply with the minimum distribution incidental
benefit requirement.
The provisions of this paragraph (14) of Article VIII shall prevail
over the provisions of Article IV to the extent the provisions of
this paragraph (14) are permissible under proposed and/or final
regulations promulgated by the Internal Revenue Service.
15. In the event any amounts remain in the custodial account after the
death of the Depositor, the rights of the Depositor hereunder shall
thereafter be exercised by his or her beneficiary.
16. The Custodian is authorized to hire agents (including any transfer
agent for Fund Shares) to perform certain duties hereunder.
17. This Agreement shall terminate coincident with the complete
distribution of the assets of the Depositor's account.
18. All notices to be given by the Custodian to the Depositor shall be
deemed to have been given when mailed to the address of the Depositor
indicated by the Custodian's records.
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19. The Custodian shall not be responsible for any losses, penalties or
other consequences to the Depositor or any other person arising out of
the making of, or the failure to make, any contribution or withdrawal.
20. In addition to the reports required by paragraph (2) of Article V, the
Custodian shall periodically cause to be mailed to the Depositor in
respect of each such period an account of all transactions affecting
the custodial account during such period and a statement showing the
custodial account as of the end of such period. If, within 60 days
after such mailing, the Depositor has not given the Custodian written
notice of any exception or objection thereto, the periodic accounting
shall be deemed to have been approved and, in such case or upon the
written approval of the Depositor, the Custodian shall be released,
relieved and discharged with respect to all matters and statements set
forth in such accounting as though the account had been settled by
judgment or decree of a court of competent jurisdiction.
21. In performing the duties conferred upon the Custodian by the Depositor
hereunder, the Custodian shall act as the agent of the Depositor. The
parties do not intend to confer any fiduciary duties on the Custodian
and none shall be implied. The Custodian shall not be liable (and does
not assume any responsibility) for the collection of contributions, the
deductibility or the propriety of any contribution under this
Agreement, the selection of any Fund Shares for this custodial account,
or the purpose or propriety of any distribution made in accordance with
Article IV and Paragraph 13, 14 or 15 of Article VIII, which matters
are the sole responsibility of the Depositor or the Depositor's
beneficiary, as the case may be.
22. The Custodian shall be responsible solely for the performance of those
duties expressly assigned to it in this Agreement and by operation of
law. The Custodian shall have no duty to account for deductible
contributions separately from nondeductible contributions, unless
required to do so by applicable law. In determining the taxable amount
of a distribution, the Depositor shall rely only on his or her Federal
tax records, and the Custodian shall withhold Federal income tax from
any distribution from the custodial account as if the total amount of
the distribution is includable in the Depositor's income.
23. Except to the extent superseded by Federal law, this Agreement shall be
governed by, and construed, administered and enforced according to, the
laws of the Commonwealth of Pennsylvania, and all contributions shall
be deemed made in Pennsylvania.
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GENERAL INSTRUCTIONS
(Section references are to the Internal Revenue Code unless otherwise
noted.)
PURPOSE OF FORM
Form 5305-A is a model custodial account agreement that meets the
requirements of section 408(a) and has been automatically approved by
the IRS. An individual retirement account (IRA) is established after
the form is fully executed by both the individual (Depositor) and the
Custodian and must be completed no later than the due date of the
individual's income tax return for the tax year (without regard to
extensions). This account must be created in the United States for the
exclusive benefit of the Depositor or his or her beneficiaries.
Individuals may rely on regulations for the Tax Reform Act of 1986 to
the extent specified in those regulations.
Do not file Form 5305-A with the IRS. Instead, keep it for your
records.
For more information on IRAs, including the required disclosure you can
get from your custodian, get Pub. 590, Individual Retirement
Arrangements (IRAs).
DEFINITIONS
CUSTODIAN.--The Custodian must be a bank or savings and loan
association, as defined in section 408(n), or any person who has the
approval of the IRS to act as custodian.
DEPOSITOR.--The Depositor is the person who establishes the custodial
account.
IDENTIFYING NUMBER
The depositor's social security number will serve as the identification
number of his or her IRA. An employer identification number is required
only for an IRA for which a return is to be filed to report unrelated
business taxable income. An employer identification number is required
for a common fund created for IRAs.
IRA FOR NONWORKING SPOUSE
Form 5305-A may be used to establish the IRA custodial account for a
nonworking spouse.
Contributions to an IRA custodial account for a nonworking spouse must
be made to a separate IRA custodial account established by the
nonworking spouse.
SPECIFIC INSTRUCTIONS
ARTICLE IV.--Distributions made under this article may be made in a single
sum, periodic payment, or a combination of both. The distribution option
should be reviewed in the year the Depositor reaches age 70 1/2 to ensure
that the requirements of section 408(a)(6) have been met.
ARTICLE VIII.--Article VIII and any that follow it may incorporate
additional provisions that are agreed to by the Depositor and Custodian to
complete the agreement. They may include, for example, definitions,
investment powers, voting rights, exculpatory provisions, amendment and
termination, removal of the Custodian, Custodian's fees, state law
requirements, beginning date of distributions, accepting only cash,
treatment of excess contributions, prohibited transactions with the
Depositor, etc. Use additional pages if necessary and attach them to this
form.
Note. Form 5305-A may be reproduced and reduced in size for adoption to
passbook purposes.
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