What Is A Roth Retirement Plan? 
To encourage people to prepare for retirement , individual retirement -LRB- IRA -RRB- accounts were allowed by congress . These plans allowed a participant to reduce their current income tax by the amount of the contribution to an IRA . The entire amount of the proceeds upon retirement is then taxable as ordinary income . A Roth plan approaches the same issue in the opposite way . It doesnt allow a current deduction for contributions to the plan , however , at retirement the entire amount in the plan , which includes all the interest earned , is paid to the participant without any income tax . There are limitations in contributions and you should consult with an accountant . 