What's the difference between a Traditional and Roth IRA?

Both have a $7,000 limit for 2025, but the tax timing is reversed. A Traditional IRA gives you a tax deduction now (if eligible) and taxes withdrawals in retirement. A Roth IRA gives no deduction now, but qualified withdrawals — including all investment growth — are completely tax-free, and there are no required minimum distributions for the original owner.

Is a Roth or Traditional IRA better?

It comes down to your tax rate now versus in retirement. If you expect a higher rate later, a Roth (pay tax now at the lower rate) usually wins. If you expect a lower rate in retirement, a Traditional (deduct now at the higher rate) usually wins. When the rates are equal the after-tax result is the same. The break-even calculator on this page works it out for your numbers.

What is the Roth IRA income limit for 2025?

For 2025 the Roth IRA modified-AGI phase-out is $150,000–$165,000 for single filers and $236,000–$246,000 for married filing jointly. Above the top of the range you can't contribute to a Roth IRA directly. A Traditional IRA has no income limit to contribute. Source: IRS Notice 2024-80, verified 2026-06-18.

Can I contribute to both a Traditional and Roth IRA?

Yes, but they share one combined limit. For 2025 your total across both Traditional and Roth IRAs is $7,000 ($8,000 if you're 50 or older) — not $7,000 each. You choose how to split that single limit between the two account types.

What is the Traditional IRA vs Roth IRA: Tax Now or Tax Later? (2025)?

Deduct now and pay tax later, or pay tax now for tax-free growth — compare a Traditional and Roth IRA with the real 2025 IRS limits and a break-even calculator. It runs free in your browser on Gera Tools, with nothing uploaded.

Traditional IRA vs Roth IRA: Tax Now or Tax Later? (2025)

Name: Traditional IRA vs Roth IRA: Tax Now or Tax Later? (2025)
Creator: Gera Tools
License: https://creativecommons.org/licenses/by/4.0/

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Traditional IRA vs Roth IRA

A Traditional IRA and a Roth IRA share the same $7,000 (2025) contribution limit but tax you at opposite ends. Traditional: deduct your contribution now, pay income tax when you withdraw. Roth: no deduction now, but qualified withdrawals — including all the growth — are 100% tax-free, and there are no required minimum distributions for the original owner. This page compares them line by line, with an after-tax break-even calculator.

The table below compares each account on the rows that actually differ — the 2025 IRS contribution limits, catch-ups, employer match, income limits, early-withdrawal rules and required minimum distributions. It runs in your browser; nothing is sent to any server.

2025 limits used: 401(k)/403(b)/457(b) employee deferral $23,500 (+$7,500 at 50+, +$11,250 at 60–63); IRA $7,000 (+$1,000 at 50+); Roth IRA MAGI phase-out single $150,000–$165,000, MFJ $236,000–$246,000. Source: IRS Notice 2024-80 + IRS Newsroom IR-2024-285, verified 2026-06-18. Always confirm the current year’s figures at irs.gov.