The decision between Roth and Traditional IRA is one of the most common in retirement planning. The difference is simple: Traditional = tax break now, Roth = tax break later.
But which is better for you? It depends on your current tax bracket, expected future tax bracket, and income level (Roth IRAs have income limits).
Side-by-Side Comparison (2026)
| Feature | Traditional IRA | Roth IRA |
|---|---|---|
| 2026 Contribution Limit | $7,000 ($8,000 if 50+) | $7,000 ($8,000 if 50+) |
| Tax Treatment (Contributions) | Tax-deductible (subject to income limits) | Not deductibile (after-tax) |
| Tax Treatment (Growth) | Tax-deferred | Tax-free |
| Tax Treatment (Withdrawals) | Taxed as ordinary income | Tax-free (if qualified) |
| 2026 Income Limit for Contributions | None (but deductibility has limits) | Phase-out at $150K–$165K (single), $236K–$246K (MFJ) |
| RMDs Required? | Yes (starting at 73) | No (during owner's lifetime) |
| Early Withdrawal Penalty | 10% (exceptions apply) | 10% on earnings only (contributions can be withdrawn anytime tax/penalty-free) |
The Core Question: Are You in a Higher or Lower Tax Bracket Now vs. Retirement?
✅ Choose Traditional IRA If...
- You're in a high tax bracket now (e.g., 32%, 35%, 37%) and expect to be in a lower bracket in retirement
- You want to reduce your current taxable income (e.g., to qualify for a lower capital gains rate or avoid IRMAA surcharges)
- Your income is too high for direct Roth IRA contributions (above the Roth phase-out)
✅ Choose Roth IRA If...
- You're in a low tax bracket now (e.g., 10%, 12%, 22%) and expect to be in a higher bracket in retirement
- You want tax-free withdrawals in retirement (no RMDs, no taxable income)
- You want to leave a tax-free inheritance to your heirs (Roth IRAs have no RMDs for beneficiaries for 10 years)
- You're young and currently in a low bracket (Roth is usually better for young people)
2026 Income Limits (Who Can Contribute to a Roth IRA?)
Roth IRAs have income limits — if your income is too high, you cannot contribute directly to a Roth IRA:
| Filing Status | Phase-Out Range (2026) | Above This = Cannot Contribute |
|---|---|---|
| Single | $150,000–$165,000 | $165,000+ |
| Married Filing Jointly | $236,000–$246,000 | $246,000+ |
| Married Filing Separately | $0–$10,000 | $10,000+ |
Traditional IRA note: There's no income limit for contributing to a traditional IRA, but there is an income limit for deducting your contribution (if you or your spouse have a retirement plan at work).
The "Backdoor" Roth IRA (For High Earners)
If your income is above the Roth IRA limits, you can still contribute to a Roth IRA via the "backdoor" Roth strategy:
- Contribute to a non-deductible traditional IRA (no income limit for contributions)
- Immediately convert the traditional IRA to a Roth IRA
- Pay taxes on any pre-tax amounts in the traditional IRA
Warning: The "pro-rata rule" can make this expensive if you have existing pre-tax IRA balances. Use our Roth Conversion Calculator to see if it makes sense for you.
Which Should YOU Choose? Use Our Calculator
Instead of guessing, use our Roth Conversion Calculator to:
- Enter your current income and expected retirement income
- See the total tax difference between Roth and traditional over your lifetime
- Factor in RMDs, estate planning, and your state's tax situation
🧮 Roth vs Traditional: Which is Better for YOU?
Free, instant, personalized analysis.
Open Roth Conversion Calculator →Frequently Asked Questions
Can I contribute to both a Roth and Traditional IRA in the same year?
Yes, but the total combined contribution cannot exceed $7,000 ($8,000 if 50+). For example, you could contribute $4,000 to a traditional IRA and $3,000 to a Roth IRA.
Which is better for a young person just starting their career?
Usually Roth. Young people are typically in a lower tax bracket now than they will be later in their career. Paying taxes now at a low rate and getting tax-free withdrawals later is usually the better deal. Plus, Roth IRAs have more withdrawal flexibility.
Can I convert my traditional IRA to a Roth IRA?
Yes. This is called a "Roth conversion." You'll pay ordinary income tax on the amount converted, but after that, the funds grow tax-free. It's often beneficial to do conversions in low-income years (e.g., a sabbatical, unemployment, or early retirement before claiming Social Security).