What Is a Roth IRA? How to Get Started

By Motley Fool Retirement Team – Updated Nov 2, 2024 at 11:30 AM

Key Points

Roth IRA contributions grow tax-free and allow withdrawals without tax after age 59 1/2 if held for more than five years.
Eligibility to contribute to a Roth IRA is based on having earned income and falls under specific income limits.
Roth IRA benefits include tax-free retirement income, no RMDs, and tax-free inheritance for heirs.

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An infographic explaining the tax differences between a traditional IRA and a Roth IRA for present and future payments. — Image source: The Motley Fool.

Which Roth IRA account is right for you?

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Modified Adjusted Gross Income

Modified adjusted gross income (MAGI) is an income metric that is used to determine eligibility for certain tax deductions, credits, and additional taxes.

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Data source: IRS.
Tax filing status	2024 MAGI	2025 MAGI	Contribution limit
Single, head of household, or married person filing separately who did not live with spouse during the tax year	Less than $146,000	Less than $150,000	$7,000 ($8,000 for ages 50 and older) in 2024 and 2025
	$146,000-$161,000	$150,000-$165,000	Reduced in proportion to amount of income over MAGI limit
	$161,000 or more	$165,000 or more	$0 (no contribution allowed)

Data source: IRS.
Married couple filing jointly or qualifying widow/widower	Less than $230,000	Less than $236,000	$7,000 ($8,000 for ages 50 and older) in 2024 and 2025
	$230,000-$240,000	$236,000-$246,000	Reduced in proportion to amount of income over MAGI limit
	$240,000 or more	$246,000 or more	$0 (no contribution allowed)