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Individual Retirement Account (IRA) Comparison Chart | Wescom Financial Services

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Individual Retirement Accounts — IRAs

Retirement Facts

One out of every six elderly Americans is already living below the federal poverty line.

U.S. Census Bureau

IRA Comparison Chart

Find Out Which IRA is Right for You

  Traditional IRA Roth IRA SEP IRA
2020 Contribution Limits
  • $6,000 under age 50
  • $7,000 if age 50 or older
  • $6,000 under age 50
  • $7,000 if age 50 or older
  • $57,000 or 25% of the employee's salary; whichever is less
Who is eligible? Anyone with taxable compensation in the contribution year. Individuals with taxable compensation.
For 2020: The contribution limit is phased out for those with a Modified Adjusted Gross Income (MAGI) between $124,000 — $139,000 if single; $196,000 — $206,000 if married or filing together
Must be sole proprietor, a business owner, in a partnership, or earn self-employment income by providing a service
What are the tax advantages? Tax deferred growth.

Contributions are made pre-tax and any earnings grow federal-income tax deferred until withdrawal.
Tax free growth.

Contributions are made with post-tax dollars, but investment grows tax-free and qualified withdrawals are tax free.
Tax deferred growth.

Employer contributions are made pre-tax and any earnings grow federal-income tax deferred until withdrawal.
Is my contribution tax-deductible? Contributions may be tax deductible.* No, your contribution is not tax deductible. Yes.
Is there an age limit for contributions? No.
Minimum distributions must be taken by individual's age 72 or older.**
No. No.
Minimum distributions must be taken by individual's age 72 or older.**
Are rollovers and transfers permitted? Yes. Transfers can be made from Traditional IRA or qualified employer sponsored plans. Yes, you may roll over another IRA or employer sponsored retirement account to a Roth IRA. Since 2010, all IRA owners can convert to Roth. Yes.
What are the investment options? We offer a wide range of annuities, mutual funds, stocks, bonds, ETFs, and insured CDS. We offer a wide range of annuities, mutual funds, stocks, bonds, ETFs, and insured CDS. We offer a wide range of annuities, mutual funds, stocks, bonds, ETFs, and insured CDS.

* For 2020, if you are covered by a qualified employee sponsored plan, the MAGI phase-out ranges are $65,000 – $75,000 (single) and $104,000 – $124,000 (married, filed jointly). For those covered by an employer-sponsored retirement plan, but whose spouse isn't, the deduction is phased out for joint MAGI between $196,000 – $206,000 for 2020. If neither spouse is covered by an employer-sponsored plan, the contributions are fully tax-deductible, regardless of income.

** For 2020, the CARES Act suspends RMDs