Roth IRA vs Traditional IRA contribution limit calculator is going to take away the hardship of taxpayers to remember various conditions and thresholds that finally determine the limit of ira contribution!Earlier readers were made aware of four good points about IRA contribution limits. which is as under :
IRA contribution limit
For 2015, 2016, 2017 and 2018, your total contributions to all of your traditional and Roth IRAs cannot be more than:
- $5,500 ($6,500 if you’re age 50 or older), or
- your taxable compensation for the year, if your compensation was less than this dollar limit.
Difference between Roth IRA & Traditional IRA
Both traditional IRA and Roth IRA are individual retirement Accounts to save and grow wealth for retirement age. While under the Traditional IRA, you pay tax on any accretion to the IRA investment at the time of withdrawal which is possible after you become 59.5 years old, Roth IRA kitty is fully tax-exempt. In other words, Roth IRA lets you grow a tax-free retirement kitty.
The second major difference, as far as taxation is concerned i , IRA (Roth) contribution can not be deducted from gross income. In other words, no tax deduction is allowed for contribution to IRA (Roth) .But the traditional IRA contribution gets you tax deduction ( above the line deduction ) depending upon the fact.But ,the government has also placed certain limitations on the quantum of contribution one can do under Traditional IRA . Please read the article on limit of contribution to IRA.