Short answer
Under US federal tax rules, traditional IRA contributions may be deductible, while distributions are generally taxable; Roth contributions are not deductible, while qualified distributions are tax-free. Neither shorthand is absolute: traditional IRAs can contain nondeductible contributions, and nonqualified Roth earnings are taxable. 1 The figures below apply to tax year 2026, as announced November 13, 2025. 2
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At a glance
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| Question | Traditional IRA | Roth IRA |
|---|---|---|
| Contribution deductible? | Possibly | No |
| Withdrawal treatment? | Fully or partially taxable | Contributions untaxed; qualified earnings untaxed |
| Income restriction discussed here? | Deduction phaseout | Contribution phaseout |
Tax treatment comes from IRS Topic 451; 2026 phaseout rules come from the dated IRS announcement. 1 2
What each thing is
Both are personal retirement savings arrangements, not jointly owned accounts. A traditional IRA generally postpones taxation until distribution. A Roth must be designated as such when established; its defining benefit concerns the tax treatment of distributions rather than a contribution deduction. 1
Key differences
Deduction eligibility and contribution eligibility are different questions. For 2026, a workplace-covered single taxpayer’s traditional deduction phases out at $81,000–$91,000; Roth contribution eligibility for singles and heads of household phases out at $153,000–$168,000. Traditional deduction phaseouts do not apply when neither spouse has workplace-plan coverage. 2
How to tell them apart
Start with the account’s designation, not whether a deduction appeared on a tax return. Roth designation is required at setup, but a traditional contribution can be nondeductible. Thus, absence of a deduction cannot by itself identify a Roth IRA. 1
Where they overlap
Both fall within the IRA category. The IRS announces a 2026 annual IRA contribution limit of $7,500 and an additional $1,100 catch-up amount for people age 50 or older. 2 Taxable early distributions from either type may also face an additional 10% tax, with exceptions. 1
Edge cases
A traditional IRA containing nondeductible contributions complicates the usual “taxable withdrawals” shorthand: distributions may be only partly taxable, and nondeductible contributions require Form 8606. Roth withdrawals also require separating contributions from earnings; earnings in nonqualified distributions are taxable. 1
Why the distinction exists
The distinction identifies where the federal tax benefit occurs: a potential deduction and deferred taxation for traditional IRAs, versus no contribution deduction and favorable distribution treatment for Roth IRAs. It also explains why income checking targets a traditional deduction but a Roth contribution. 1 2
Common misconceptions
“Roth means every withdrawal is tax-free” is incorrect. The IRS gives age 59½ plus the five-year period beginning with the first contribution tax year as an example of qualified earnings distributions. 1 Nor is there one universal 2026 eligibility cutoff: filing status and, for traditional deductions, workplace coverage matter. 2
Examples
Hypothetical case one: someone made only deductible traditional IRA contributions; the IRS says distributions are fully taxable. Hypothetical case two: a Roth distribution returns contributions and includes nonqualified earnings; the returned contributions are untaxed, but those earnings are taxable. These cases illustrate why account type alone does not settle every withdrawal’s treatment. 1