Traditional IRA

faqs

• If I qualify to contribute to both a Traditional IRA and a Roth IRA, are there tax implications I should consider?
  Having a mix of both pretax and Roth contributions can help create additional flexibility in retirement to respond to a great unknown—future tax rates. For people who expect income in retirement to be as high or higher than their current level, others who expect their tax rate in retirement to be higher than today, or younger people who expect steady income growth over their careers, Roth IRA contributions may be the better choice. But if you believe that your tax rates will be lower in retirement than they are now, you may want to prioritize pretax vehicles like the Traditional IRA. Our IRA Contribution Calculator allows you to answer a few questions and find out which one might be right for you.
• Are there age limits to contribute to an IRA?

  The SECURE Act of 2019 removed the age limit at which an individual can contribute to a traditional IRA. Prior to 1/1/2020, an individual could not contribute after age 70½. 

  The Act now allows anyone that is working and/or has earned income to contribute to a Traditional IRA regardless of age.

• How much can I contribute to my IRA?
  You can contribute up to the lesser of 100% of your earned income or $6,000 for 2022. For 2023, you can contribute up to the lesser of 100% of your earned income or $6,500. Once you reach age 50, contribution limits on IRAs increase by another $1,000. This allows for a "catch-up" contribution for those nearing retirement.
• How can the IRA Contribution Calculator help me?
  Answer a few questions in the IRA Contribution Calculator to find out whether a Roth or traditional IRA might be right for you, based on how much you're eligible to contribute and how much you might be able to deduct on your taxes.
• How much money do I need to open a Fidelity IRA?
  There is no minimum dollar amount required to open a Fidelity IRA. Some mutual funds may have minimums required to purchase; review each fund’s prospectus for details.
• Can I withdraw money from my IRA?

  Under certain conditions, you can withdraw money from your IRA without penalty. The rules vary depending on the type of IRA you have. Generally, for a Traditional IRA, distributions prior to age 59½ are subject to a 10% penalty in addition to federal and state taxes unless an exception applies.2 Starting at age 59½, you can begin taking money out of your IRA without penalty, but you will still be responsible for taxes that might be due. Per the SECURE Act of 2019, as of 1/1/2020, upon birth or adoption of a child, an IRA owner may withdraw up to $5,000 penalty-free from any type of defined contribution plan or a Traditional IRA2 Such distributions may also be repaid.

  Starting at age 73⁶, required minimum distributions (RMDs) begin—you can calculate how much you will be required to take using this RMD Calculator. You can also log in to get estimated RMDs for your Fidelity IRAs (Traditional IRAs, SEP IRAs, SIMPLE IRAs, Rollover IRAs, and all small-business retirement plans). Our system also keeps track of all withdrawals and allows you to set up automated distributions. Learn more about planning your retirement distributions.

  For a Roth IRA, you can take a penalty-free, federal tax-free distribution of contributions at any time. Provided you have met the five-year aging requirement, and one of the following conditions, you may also take a tax-free and penalty-free distribution of earnings: 

  • Over age 59½
  • Death or disability
  • First-time home purchase

  Note: There are no RMDs for Roth IRAs during the lifetime of the original owner. Please review Withdrawing From Your IRA for more information.
• Can I transfer my IRA from another institution?
  Yes, visit IRA Transfers for a quick overview of the online process.
• Can I roll over my old 401(k) from a previous employer to my Roth or Traditional IRA?
  Generally, yes. Contact our rollover specialists, and they'll guide you through the entire process—from beginning to end. Call 800-343-3548 to get started.
• Where can I view my tax forms for my retirement accounts?
  You can access your available tax forms and find out when to expect additional forms by clicking here: view tax formsLog In Required
• What tax form will I receive for my Traditional IRA contributions?

  If you contributed to a Traditional IRA, you will receive Form 5498 from Fidelity in January. Form 5498 summarizes your IRA contributions, holdings, and fair market value. If you make a prior year contribution between January and the tax filing deadline, you will receive a revised 5498 in May. This form is informational only and does not need to be filed with your taxes. For help with this tax form, see the IRS Instructions for Form 5498 (PDF).

• What tax form will I receive for my IRA withdrawals?

  If you made withdrawals (of $10 or greater) from an IRA, you will receive Form 1099-R from Fidelity in January. For more details on Form 1099-R and reporting the withdrawals on your return, see the IRS Instructions for Form 1099-R (PDF).