1.Traditional IRA
A Traditional IRA is a tax-advantaged individual savings plan where contributions may be tax-deductible. Typically, funds in a Traditional IRA are not taxed until withdrawn. The total annual contributions to all Traditional IRAs for 2023 cannot exceed $6,500 for individuals, or $7,500 if you’re age 50 or older (for 2024, it’s $7,000 for individuals and $8,000 for those aged 50 or older).
The growth or investment income in an IRA account is tax-deferred. However, any money withdrawn from the IRA account after the age of 59 and a half is subject to taxation.
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