IRAs offer great tax-favored ways to save for retirement.
And they ve gotten even better over the years. But in favorable contrast to a traditional IRA, earnings are free from income taxes upon withdrawal if you meet certain conditions. In addition to the up-front tax break, money in a traditional IRA grows tax deferred. Upon withdrawal, your contributions and earnings are taxed as regular income. Although your contributions aren t tax deductible, your earnings still grow tax deferred.