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Traditional vs. Roth IRA

Description	Traditional IRA	Roth IRA
Annual Contribution	Single - lesser of 100% of earned income or $5,000. Married - $10,000 ($5,000 for each spouse). Contributions may be tax-deductible if certain eligibility requirements are met. IRA Catch-up contributions will be allowed for individuals who are age 50 or over before the end of each tax year. For the tax year 2008, the catch up amount is $1,000.	Single - lesser of 100% of earned income or $5,000. Married - $10,000 ($5,000 for each spouse). Contributions may be tax-deductible if certain eligibility requirements are met. IRA Catch-up contributions will be allowed for individuals who are age 50 or over before the end of each tax year. For the tax year 2008, the catch up amount is $1,000.
Withdrawals	May be taxed as ordinary income.	Tax-free and IRS penalty-free; some restrictions apply.
Contribution Age Limit	No contributions after age 70 1/2.	No age limit.
Minimum distribution requirements	Begin the year the IRA Owner reaches age 70 1/2.	No required distributions prior to death.
Rollovers	May convert to a Roth IRA; some restrictions apply. May roll over distributions from qualified retirement plans; some restrictions apply. May roll over to another traditional IRA; some restrictions apply.	May roll over to another Roth IRA; some restrictions apply. May roll over distributions from qualified retirement plans; some restrictions apply.
IRS penalty free withdrawals	Yes, penalty exceptions apply, including first-time home purchase and higher education.	Yes, penalty exceptions apply, including first-time home purchase and higher education.
Additional Highlights	Tax deduction based on income levels if covered by employer's retirement plan (or if spouse of plan participant).	Participation is based on income levels.

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