An IRA is an individual retirement account that can achieve tax-free growth or tax-deferred growth. The three main types of IRAs each have different advantages:
Traditional IRA – You make contributions with money you may be able to deduct on your tax return, and any earnings can potentially grow tax-deferred until you withdraw them in retirement.
Roth IRA – You make contributions with money you’ve already paid taxes on (after-tax), and your money may potentially grow tax-free, with tax-free withdrawals in retirement, provided that certain conditions are met.
Rollover IRA – A Traditional IRA intended for money “rolled over” from a qualified retirement plan. Rollovers involve moving eligible assets from an employer-sponsored plan, such as a 401(k), 403(b), or pension into an IRA.
We do not give tax advice and recommend consulting with a tax adviser for your specific situation