Traditional IRA Or Roth IRA?
Which is best for you?

  Traditional Roth
Eligibility Requirements Under age 70½ with compensation Any age with compensation, subject to AGI phaseout limits
Tax Benefit Tax-deferred growth Tax-free growth
Tax Treatment
of Withdrawals
Earnings and deductible contributions will be taxed when withdrawn Tax-free withdrawals (5-year requirement and other conditions must be met).
Contributions Tax-deductible (Deductibility depends on retirement plan participation status and AGI limits.) Not deductible
Maximum Annual
Contribution
$5,500 or 100% of compensation, whichever is less, per person (aggregate to both a traditional or Roth IRA), plus an additional $1,000 for age 50 and older. Same
10% Early
Withdrawal Penalty
Yes, if under age 59½ and withdrawal is not for higher education expenses, qualified first home purchase, certain major medical expenses, or certain long-term unemployment expenses. Same
Mandatory Distributions Distributions must start at age 70½. No requirement