Roth IRA vs. Traditional IRA

Tax timing is the main difference

Traditional IRA contributions may be deductible depending on income, filing status and workplace-plan coverage; investment growth is tax-deferred and withdrawals are generally taxable under applicable rules. Roth contributions are made with after-tax dollars, and qualified Roth withdrawals can be tax free.

The correct choice depends on current and expected future tax circumstances, eligibility and whether the current deduction is actually available.

2026 contribution limits

The IRS increased the IRA contribution limit to $7,500 for 2026. The catch-up contribution for people age 50 or older is $1,100, allowing up to $8,600 total if otherwise eligible. The contribution limit is shared across traditional and Roth IRAs rather than applying separately to each.

2026 Roth income phase-outs

For 2026, the Roth IRA contribution phase-out is $153,000 to $168,000 of modified AGI for single filers and heads of household, and $242,000 to $252,000 for married couples filing jointly. Married filing separately while living with a spouse uses the $0 to $10,000 range under IRS rules.

Traditional IRA deduction rules can be separate from contribution eligibility

Traditional IRA deductibility can phase out when the taxpayer or spouse is covered by a workplace retirement plan. For 2026, the IRS lists an $81,000 to $91,000 phase-out for a single taxpayer covered by a workplace plan and $129,000 to $149,000 for married filing jointly when the contributor is covered. Other spousal situations use different ranges.