Traditional IRA

• A married person who is not an active participant in a retirement plan, but whose spouse is an active participant will be eligible for a fully deductible contribution to a Traditional IRA if MAGI* is under $150,000
• Earnings compound tax-deferred until withdrawn, usually out-earning taxable non-IRA investments. Earnings are then taxed when withdrawn, usually at a lower tax rate.
• Contributions may be tax deductible if certain requirements are met.

Roth IRA

• Regular contributions can be withdrawn tax and penalty free anytime
• Earnings are tax free if account is open for five years and withdrawn for one of the following qualified reasons:
  • Death
  • Disability
  • Age 59 1/2
  • First time home purchase
  • Not required to start withdrawals at age 73