What is a Roth IRA Account?

A Roth IRA (Individual Retirement Account) is a type of personal savings plan designed to help individuals save for retirement. Unlike a Traditional IRA, contributions to a Roth IRA are not tax-deductible. However, the money in the account can grow tax-free, and qualified withdrawals from the account are tax-free.

To be eligible to contribute to a Roth IRA, an individual must meet certain criteria, such as having earned income and falling within certain income limits. The amount that can be contributed to a Roth IRA may be limited based on the individual's income and tax filing status.

Withdrawals from a Roth IRA are generally tax-free if they meet certain conditions, such as being taken after age 59½ and after the account has been open for at least five years. There are also exceptions to the rules for taking tax-free withdrawals, such as withdrawals made due to disability or to pay for certain first-time homebuyer expenses.

Roth IRAs can be a good savings option for individuals looking to save for retirement and who want the potential for tax-free growth and tax-free withdrawals in retirement. It is important to consider the income limits and other rules that apply to Roth IRAs when deciding whether they are the right choice for your retirement savings needs.