Is a Traditional or Roth IRA right for you?

Traditional IRA Roth IRA
Can I open and contribute to an IRA at any age? No, you must not have reached age 70 1/2 by the end of year to open and contribute to a Traditional IRA. Yes, you can open and contribute to a Roth IRA at any age.
Is there a limit on how much I can contribute to an IRA? For 2017, you can contribute to a Traditional IRA up to:
  • $5,500, or
  • $6,500 if you were age 50 or older by the end of 2017.

For 2018, you can contribute to a Traditional IRA up to:

  • $5,500, or
  • $6,500 if you were age 50 or older by the end of 2018.

 For 2017, you can contribute to a Roth IRA up to:
  • $5,500, or
  • $6,500 if you were age 50 or older by the end of 2017.

For 2018, you can contribute to a Roth IRA up to:

  • $5,500, or
  • $6,500 if you were age 50 or older by the end of 2018.
Are contributions to an IRA deductible? Yes, contributions to a Traditional IRA are deductible depending on your income, filing status, or whether your covered by a retirement plan. No, contributions to a Roth IRA are never deductible.
Are there required minimum distributions from an IRA? Yes, you must receive required minimum distributions from a Traditional IRA in the year you reach 70 1/2. No, you do not have to take distributions from a Roth IRA regardless of age.
Are distributions from an IRA taxable? Distributions from a Traditional IRA are taxed as ordinary income. If you made nondeductible contributions, not all of the distribution is taxable. Distributions from a Roth IRA are not taxed as long as they are qualified distributions.

← Back to Retirement & Educational Savings Accounts