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What is a Roth IRA?

  • A Roth IRA is a retirement savings option.
  • Contributions are nondeductible— the owner must pay income taxes on contributions.
  • Distributions from a Roth IRA are tax-free as long as the owner is at least 59½ years old AND a five-year holding period has been met of the original contribution.
  • To contribute to a Roth IRA, you must be at least 18 years old.

Note, there are Modified Adjusted Gross Income (MAGI) restrictions.

For more information on the differences between a Roth and Traditional IRA, click here.