![\"IRA](\"http:\/\/sandbox.planmember.com\/fccontent\/wp-content\/uploads\/sites\/26\/2020\/05\/ira-basics-graph.png\")
<\/sup><\/p>\nWith a traditional IRA, your contributions may be fully or partially deductible from your taxable income, which reduces your income taxes.2<\/sup>\u00a0Your money grows tax-deferred until it\u2019s withdrawn in retirement, at which time it\u2019s taxed as ordinary income. While contributions to a Roth IRA don\u2019t reduce your taxable income, your account grows tax free and qualified withdrawals are free of income taxes.<\/p>\n Your modified Adjusted Gross Income (AGI), or the combined AGI of you and your spouse, determines both your eligibility to contribute to a Roth IRA and your eligibility to make taxdeductible contributions to a traditional IRA.<\/p>\n Although your AGI may disqualify you from contributing to a Roth IRA, you are always free to contribute to a traditional IRA regardless of your income. If you qualify to make tax deductible contributions, a traditional IRA might make more sense.2<\/sup>\u00a0If you don\u2019t qualify, then a Roth IRA might work better as long as you meet the income requirements for eligibility.3<\/sup>\u00a0Other things to consider when choosing between a Roth and a traditional IRA include:<\/p>\n You can convert a traditional IRA to a Roth IRA. However, you will have to pay income taxes on the amount you convert.<\/p>\n <\/p>\n 1. Combined contributions to Roth and traditional IRAs cannot exceed $6,000 in 2020 ($7,000 for individuals age 50 or older). Traditional IRA vs. Roth IRA An Individual Retirement Account (IRA) is a retirement savings account established with a financial institution that allows you to save for retirement in a tax-advantaged<\/p>\n","protected":false},"author":7,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"page-template\/template-standard-post.php","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"wf_post_folders":[33],"acf":[],"yoast_head":"\r\nWhich IRA is best for you?<\/h2>\n
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\n2. If you and your spouse (if you file a joint tax return) do not participate in an employer-sponsored plan, your contributions to a traditional IRA are 100% tax deductible. Otherwise, deductibility is phased out above certain modified AGI limits.
\n3. For the 2020 tax year, single and head of household tax filers with a modified AGI of up to $124,000 and joint filers with a modified AGI of up to $196,000 are eligible to make the maximum annual Roth IRA contribution. Above these limits, eligibility is gradually phased out.<\/p>\n","protected":false},"excerpt":{"rendered":"