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Roth Comparison Chart

Comparison of Roth 401(k), Roth IRA, and Traditional 401(k) Retirement Accounts
Characteristic	Designated Roth 401(k) Account	Roth IRA	Traditional, Pre-Tax 401(k) Account
Contributions	Designated Roth employee elective contributions are made with *after-tax dollars*.	Roth IRA contributions are made with *after-tax dollars*.	Traditional, pre-tax employee elective contributions are made with *before-tax dollars*.
Income Limits	No income limitation to participate.	Income limits: married $183,000/single $125,000 modified AGI for 2012	No income limitation to participate.
Maximum Elective Contribution	Aggregate* employee elective contributions limited to $17,000 in 2012 ($17,500 in 2013) plus an additional $5,500 for employees age 50 or over.	Contribution limited to $5,000 for 2012 ($5,500 for 2013) plus an additional $1,000 for employees age 50 or over.	Same aggregate* limit as Designated Roth 401(k) Account
Taxation of Withdrawals	Withdrawals of contributions and earnings are not taxed provided it’s a qualified distribution – the account is held for at least 5 years and made: On account of disability, On or after death, or On or after attainment of age 59½.	Same as Designated Roth 401(k) Account and can have a qualified distribution for a first time home purchase.	Withdrawals of contributions and earnings are subject to Federal and most State income taxes.
Required Distributions	Distributions must begin no later than age 70½, unless still working and not a 5% owner.	No requirement to start taking distributions while owner is alive.	Same as Designated Roth 401(k) Account.
* This limitation is by individual, rather than by plan. Although permissible to split the annual employee elective contribution between designated Roth contributions and traditional, pre-tax contributions, the combination cannot exceed the deferral limit - $17,000/$22,500 in 2012, $17,500/$23,000 in 2013.

Page Last Reviewed or Updated: 22-Oct-2012