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Traditional IRA |
Roth IRA |
| Tax Benefits |
- Tax-deferred growth: all interest earned is tax sheltered until withdrawn.
- Deductible contributions: you may deduct contributions from your taxable income. How much you may deduct depends on your marital status, wage income and employee pension status.
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- Tax-free growth: keep your Roth IRA for at least five years, withdraw funds for the approved reasons (see below) and you will never have to pay tax on the interest you earn.
- Not tax deductible: you may not deduct Roth contributions from your taxable income.
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| Eligibility |
- Any wage-earner or non-working spouse may contribute.
- Contributions have no age requirement .
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- Any wage-earner or non-working spouse may contribute.
- Contributions have no age requirement .
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| Contribution |
- The contribution limit is $6,000 per person.
- Catch-up contributions (Age 50 and above) is an additional $1,000 per person.
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- The contribution limit is $6,000 per person.
- Catch-up contributions (Age 50 and above) is an additional $1,000 per person.
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| Income Limitations |
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- Singles – $110,000
- Married – $160,000
- Contribution limits recede at income for singles at $95,000 – $110,000.
- Contribution limits recede at income for married at $150,000 – $160,000.
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| Withdrawal |
- At age 59 ½ you may withdraw funds without penalty.
- Exceptions: you may withdraw prior to 59 ½ without penalty in the case of death, disability, specific qualified medical expenses or for a child’s college education.
- Required minimum distributions must begin at age 72 .
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- Withdrawals are generally tax-free and penalty-free if you are 59 ½ or over and have held the account for at least five years, if you are making a first home purchase, or in the case of death or disability.
- There are no required minimum distributions.
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| Conversion |
- You may convert funds from your regular IRA to a Roth IRA as long as your adjusted gross income is $100,000 or less. Married individuals filing taxes separately may not make such a conversion.
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