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Traditional and Roth IRA rules vary based on your personal circumstances. Getting a better understanding of these guidelines is a good idea for all retirement savers. Below you'll find the most important IRA rules to know for 2025 and 2026.
To contribute to a traditional IRA, you must have taxable compensation. Broadly speaking, if you earned money, you are eligible to open and contribute to a traditional IRA.
You can contribute $7,000 in 2025 and $7,500 in 2026. If you're older than 50, you can make an extra $1,000 catch-up contribution and contribute up to $8,000 in 2025. The catch-up contribution increases to $1,100 in 2026, bringing your maximum contribution to $8,600 if you're 50 or older.
Note that if you earn less than the contribution limit for the year, you can contribute only up to that amount to your traditional IRA. For example, if you earn $5,000 in 2026, your maximum contribution for the year is $5,000.
If you're the sole breadwinner and your spouse doesn't work for compensation, you're eligible to contribute to a spousal IRA in their name -- assuming you have enough earned income to cover the contribution.
The deadline to contribute is tax day for the year you're making the contribution. For example, the deadline for 2025 contributions will be April 15, 2026.
Traditional IRAs are often described as tax-deferred accounts because money invested in a traditional IRA will grow without any tax levy until the money is withdrawn, typically in retirement.
In certain circumstances, contributions to a traditional IRA are tax-deductible for the year you deposit money. This is a way of deferring tax today in exchange for paying at a later date when you withdraw the money.
There are no income restrictions on contributions to a traditional IRA. You can contribute regardless of your income level.
In the most general terms, you will receive a tax deduction if you (and your spouse) are not covered by retirement plans at your respective place(s) of employment.
If you are covered by a retirement plan at work, you will receive a full deduction for your 2025 taxes if you earn less than $79,000 (single filers) or $126,000 (married filing jointly). You will receive at least a partial tax deduction if you earned less than $89,000 (single filers) or $146,000 (married filing jointly).
These amounts increase in 2026. If you're covered by a workplace retirement plan, you can receive the full deduction for 2026 if you earn less than $81,000 (single filers) or $129,000 (married filing jointly). You can take a partial deduction if you earn less than $91,000 (single filers) or $149,000 (married filing jointly). These rules are complex, so it's smart to review the IRS deductibility guidelines before making a contribution.
At age 73, you are required to take mandatory withdrawals from traditional IRAs. These are otherwise known as required minimum distributions, or RMDs. RMDs force a specified withdrawal amount from your IRA based on your life expectancy and have the effect of increasing your taxable income for the year in which you withdraw the money.
Your first RMD is due by April 1 of the year after you turn 73. The Secure Act 2.0, which passed in late 2022, pushed back RMD age from 72 to 73.
If you withdraw from a traditional IRA before the age of 59 1/2, you'll be responsible for both taxes and a 10% penalty for early withdrawal. There are a few exceptions for medical hardship, employment separation, and other extenuating circumstances.
Similar to a traditional IRA, you'll need to have earned income. But the Roth tends to get more restrictive depending on how much income you earn; specifically, this depends on your modified adjusted gross income (MAGI). The charts below will allow you to assess your personal eligibility:
Knowing the most basic rules can go a long way in making the IRA your best friend. Making annual IRA contributions is one of the best ways to boost your net worth and enjoy a more comfortable retirement, so the time invested in learning about IRA mechanics is well worth it. This is one of those things that get much easier with repetition, so don't be afraid to start slow and go at your own pace.
