Roth IRA vs. Traditional IRA: Which Is Better for You in 2026?

The difference between a Roth IRA and a traditional IRA comes down to when you pay tax. A traditional IRA may give you a tax deduction now, and you pay tax when you withdraw. A Roth IRA gives no deduction now, but qualified withdrawals in retirement are tax-free.

Roth IRA vs. traditional IRA at a glance

2026 IRA contribution limits

For 2026, you can put up to $7,500 into your IRAs, or $8,600 if you are 50 or older ($7,500 plus a $1,100 catch-up). The limit is shared: it is the total across all your traditional and Roth IRAs, not per account. For 2025, the limit was $7,000 plus a $1,000 catch-up.

You need taxable compensation, such as wages, to contribute (or a spouse with compensation if you file jointly). There is no age cap for either type. You can contribute for a tax year until your tax filing deadline, not including extensions.

Roth IRA income limits for 2026

Your ability to contribute to a Roth IRA phases out based on your modified adjusted gross income (MAGI):

Below the range you can contribute the full amount; above it you can’t contribute to a Roth IRA directly.

Traditional IRA deduction limits for 2026

Anyone with compensation can contribute to a traditional IRA. But if you or your spouse are covered by a retirement plan at work, your deduction phases out at these MAGI levels:

Withdrawal rules

• Traditional IRA: withdrawals are taxed as ordinary income. Taking money out before age 59½ generally adds a 10% additional tax, unless an exception applies.
• Roth IRA: a withdrawal is “qualified,” and tax-free, if it comes at least five years after your first Roth contribution year and you are 59½ or older, disabled, or using it for a qualified first-time home purchase (or it is paid after death).

Required minimum distributions (RMDs)

Traditional IRA owners must start taking RMDs at age 73. The first one is due by April 1 of the year after you turn 73. Roth IRAs have no RMDs while the original owner is alive, though beneficiaries who inherit one do.

Which one should you choose?

• A Roth IRA may fit better if you expect to be in the same or a higher tax bracket in retirement, you are early in your career, or you want to avoid RMDs.
• A traditional IRA may fit better if you want to lower your taxable income now and expect a lower tax bracket in retirement.
• You don’t have to pick just one. You can split the yearly limit between both types.

See how steady contributions can grow with our compound interest calculator. Not sure what to buy inside the account? Start with how to start investing in stocks or what an ETF is.

Frequently asked questions

What is the IRA contribution limit for 2026?

$7,500, or $8,600 if you are 50 or older. The limit applies to all your IRAs combined.

Can I have both a Roth IRA and a traditional IRA?

Yes, as long as your total contributions across both stay within the yearly limit.

Can I contribute to a Roth IRA if my income is too high?

Not directly once your MAGI is above the phase-out range for your filing status.

When can I withdraw from a Roth IRA tax-free?

When the distribution is qualified: at least five years after your first Roth contribution year and after age 59½ (or disability, a qualified first-time home purchase, or death).

This guide is for education only and is not tax or investment advice. Limits change each year; check IRS.gov or a tax professional for your situation.