Traditional IRA

* Tax deductible contributions (depending on income level)
* Withdraws begin at age 59 1/2 and are mandatory by 70 1/2.
* Taxes are paid on earnings when withdrawn from the IRA
* Funds can be used to purchase a variety of investments (stocks, bonds, certificates of deposits, etc.)
* Available to everyone; no income restrictions
* All funds withdrawn (including principal contributions) before 59 1/2 are subject to a 10% penalty (subject to exception).

Roth IRA

* Contributions are not tax deductible
* No Mandatory Distribution Age
* All earnings and principal are 100% tax free if rules and regulations are followed
* Funds can be used to purchase a variety of investments (stocks, bonds, certificates of deposits, etc.)
* Available only to single-filers making up to $95,000 or married couples making a combined maximum of $150,000 annually.
* Principal contributions can be withdrawn any time without penalty (subject to some minimal conditions).