Individuals can contribute up to the annual limit to Traditional IRAs each year. These contributions may be tax-deductible. Any earnings on assets in a Traditional IRA generally grow tax-deferred. Taxes are paid when the investor takes distributions from the account. Distributions are penalty-free after age 59½ and must begin by age 70½.
Traditional IRAs may be attractive to individuals who expect to be in a lower tax bracket during retirement, or those who prefer to defer taxes into retirement.