A Traditional IRA is an Individual Retirement Account to which you can contribute pre-tax or after-tax dollars, giving you immediate tax benefits if your contributions are tax-deductible. With a Traditional IRA, your money can grow tax-deferred, but you’ll pay ordinary income tax on your withdrawals, and you must start taking distributions after age 72. Unlike with a Roth IRA, there are no income limitations to open a Traditional IRA. It may be a good option for those who expect to be in the same or lower tax bracket in the future.
There is no income limit for a Traditional IRA, and depending on how much you make and whether you are in an employer retirement plan, your contributions may be tax-deductible. Current contribution limits:
$6,000 if you're under age 50.
$7,000 if you’re age 50 or older.
See Traditional IRA withdrawal rules
Age 59½ and under: Taxes and 10% penalty apply.
Age 59½ to 72: Taxes apply, but there is no 10% early withdrawal penalty.
Age 72 & over: Taxes apply. Required Minimum Distributions (RMD) are required.