Key takeaways
- The main difference is when you pay tax. Roth IRA contributions aren’t deductible, but qualified withdrawals are tax-free. Traditional IRA contributions may be deductible, but withdrawals are taxable.
- For 2026, the IRS says you can put in up to $7,500 in total across all your IRAs, or $8,600 if you’re 50 or older, or your taxable income for the year if that’s less.
- Roth IRAs have income limits, and traditional IRA deductions can be reduced if you’re covered by a plan at work.
- You must generally start taking money out of a traditional IRA at age 73. A Roth IRA has no such requirement while you’re alive.
This article is general information, not tax or financial advice. Rules change and depend on your situation, so consider a tax professional.
The basic difference
Both accounts let you save for retirement. According to the IRS, the key differences are in how contributions and withdrawals are taxed:
| Traditional IRA | Roth IRA | |
|---|---|---|
| Contributions | You can deduct them if you qualify | Not deductible (paid with after-tax money) |
| Who can contribute | Anyone with taxable compensation (or whose spouse has it, if filing jointly) | The same, but only if your income is below certain limits |
| Withdrawals | Deductible contributions and earnings are taxable | Tax-free if it’s a “qualified distribution” |
| Required withdrawals | Generally start at age 73 | None while the original owner is alive |
| Early withdrawals | An extra 10% tax may apply under 59½, unless an exception applies | The same extra 10% tax may apply under 59½ on part that isn’t a qualified distribution |
The IRS doesn’t say which is better. That depends on your income, your tax situation now and in retirement, and your goals.
How much can you put in? (2026)
The IRS announced in November 2025 that for 2026:
- The IRA limit is $7,500, up from $7,000.
- The catch-up for people aged 50 and over is $1,100, which makes $8,600 in total.
- The limit covers all your traditional and Roth IRAs added together. It is also capped by your taxable compensation for the year if that is lower.
The IRS says you can contribute until your tax return filing deadline, not counting extensions. For example, you can make 2022 contributions until April 18, 2023. Contributing more than the limit can lead to a 6% tax each year on the excess until you fix it.
Roth IRA income limits (2026)
You can contribute to a Roth IRA at any age if you have taxable compensation and your modified adjusted gross income (MAGI) is below certain amounts. The IRS says the 2026 phase-out ranges, where the amount you can contribute shrinks, are:
- Single or head of household: $153,000 to $168,000.
- Married filing jointly: $242,000 to $252,000.
- Married filing separately: $0 to $10,000 (not adjusted for inflation).
Traditional IRA deduction limits (2026)
Anyone with taxable compensation can contribute to a traditional IRA, but the deduction can be reduced if you or your spouse is covered by a retirement plan at work. The IRS says the 2026 phase-out ranges are:
- Single, covered by a workplace plan: $81,000 to $91,000.
- Married filing jointly, the contributor is covered at work: $129,000 to $149,000.
- Contributor not covered at work but married to someone who is: $242,000 to $252,000.
- Married filing separately, covered at work: $0 to $10,000.
If neither you nor your spouse is covered by a plan at work, these phase-outs don’t apply. The IRS also says you can contribute to an IRA even if you take part in a plan at work, but your deduction or Roth contribution may be limited by income.
Taking money out
Roth IRA. A withdrawal is tax-free if it is a “qualified distribution.” The IRS’s chart says that generally means the account has been held for at least five years and the money is taken out on or after age 59½, because of disability, or after death. A first-time home purchase can also qualify. Otherwise, part of a withdrawal may be taxable, and if you’re under 59½ the extra 10% tax may apply unless you qualify for an exception.
Traditional IRA. Deductible contributions and earnings that you take out are taxable. If you’re under 59½, an extra 10% tax may apply unless you qualify for an exception.
Required withdrawals. The IRS says you generally must start taking withdrawals from a traditional IRA when you reach age 73. Roth IRA withdrawals aren’t required until after the owner’s death. Some older IRS pages still show age 72, which was the rule before recent law changes, so check the IRS for your own situation.
Questions to ask yourself
The IRS gives no recommendation, but these are fair questions for you and a tax professional:
- Would you rather get a tax deduction now or tax-free withdrawals later?
- Is your income within the Roth limits?
- Are you covered by a plan at work, and does that affect your deduction?
- Will you need the money before 59½?
- Do you already have savings for emergencies? See our guide to building an emergency fund.
Frequently asked questions
Can I have both a traditional and a Roth IRA? Yes, but the contribution limit applies to the total across all of them.
Is there an age limit for contributing? The IRS says there’s no age limit on regular contributions to traditional or Roth IRAs for 2020 and later, as long as you have taxable compensation.
Can a non-working spouse contribute? The IRS says that if you file jointly, you may be able to contribute even if you had no taxable compensation, as long as your spouse did.
Do I have to open one by December 31? No. The IRS says you can contribute for a tax year until the filing deadline for that year’s return.
Information checked on: October 31, 2026. Limits change every year, so check the IRS before you contribute.
Sources
- IRS, 401(k) limit increases to $24,500 for 2026, IRA limit increases to $7,500 (IR-2025-111, November 13, 2025)
- IRS, Retirement topics: IRA contribution limits
- IRS, Traditional and Roth IRAs (page updated July 29, 2024)
- IRS, Roth comparison chart (figures shown through 2024)
- IRS, Retirement plan and IRA required minimum distributions FAQs
Money note: this article is for general information and is not financial advice.