Compare IRAs (Traditional IRA vs Roth IRA vs ESA) - Individual Retirement Accounts

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	Traditional IRA Account	Roth IRA Account	Coverdell Education Savings Account (ESA)
Qualifications	Must have earned income and not have reached age 70½ by the end of the year.	Must have earned income. There are no age restrictions.	The designated beneficiary must be an individual under the age of 18. The age-18 limitation will not apply to any designated beneficiary with special needs.
Maximum Contributions	2016-17: $5,500, plus $1,000 "catch-up" contribution (if age 50 or over during the year)	2016-17: $5,500, plus $1,000 "catch-up" contribution (if age 50 or over during the year)	2016-17: $2,000 per beneficiary (ESA contributions do not count against IRA contribution limits)
Tax Status of Earnings	Tax-deferred until withdrawal	Earnings grow tax-deferred. Tax-free on qualified withdrawals	Earnings grow tax-deferred. Tax-free on qualified withdrawals
Nonrefundable Tax Credit	Up to $1000 for certain individuals—income requirements apply	Up to $1000 for certain individuals -income requirements apply	Not applicable
Contribution Restrictions	None if you are under age 70½ and have earned income. However, if you are an active participant in an employer retirement plan, your contribution may not be deductible (See tax-deduction section below).	Yes, 2016 contributions phase out between $117,000 - $132,000 for singles and $184,000 - $194,000 for married couples. Married filing separate phase out: $0 - $10,000 Yes, 2017 contributions phase out between $118,000 - $133,000 for singles and $186,000 - $196,000 for married couples filing jointly. Married filing separate phase out - $0 - $10,000	Yes, 2016 & 2017 contributions phase out between $95,000 - $110,000 for single tax filers and $190,000 - $220,000 for joint tax filers. If income exceeds phase-out limit, contributions are not allowed.
Tax Deduction	Yes (See Traditional IRA Tax Deduction explanation chart below)	No	No
IRS Penalties for Early Withdrawal	None if: - Over 59 ½ - Death or disability - Qualified medical expenses - Certain health insurance - Qualified college expenses - 1st time home purchase (up to $10,000) - Due to IRS levy	None if: - Over 59 ½ - Death or disability - Qualified medical expenses - Certain health insurance - Qualified college expenses - 1st time home purchase (up to $10,000) - Due to IRS levy	None if: - For payment of qualified education expenses
Required Distributions	Must begin by April 1 following year participant turns 70 ½	Only after death of the participant	Must be completed 30 days after beneficiary reaches age 30 (except for special needs children) or death
Contribution Age Limit	Not allowed after the year age 70 ½ is attained	None	Not allowed after attaining age 18 except for special needs children

Traditional IRA Account Tax Deduction explanation

Contributions up to the limit are fully tax deductible if you are not an active participant in an employer sponsored retirement plan. If you are an active participant and a single tax filer your deductibility phase out range for tax year 2017 is $62,000 - $72,000, up from $61,000 to $71,000 in 2016. If you are married and filing a joint return your deductibility phase out range for tax year 2017 is $99,000 - $119,000, up from $98,000 to $118,000 in 2016. Note: If your spouse is not an active participant, such spouse is subject to a separate deductibility phase out range of $186,000 - $196,000 for 2017 and $184,000 - $194,000 for 2016.