Which retirement account has the best tax advantages? 

• Roth: Roth IRAs and 401(k)s are funded after you’ve already paid your taxes. That means your qualified withdrawals will be tax-free. If you expect that you’ll be in a higher tax bracket at the time you make withdrawals, a Roth retirement account may be ideal.
• Traditional: Traditional IRAs and 401(k)s are funded with pretax dollars. Your contributions reduce your taxable income now, but withdrawals in retirement are taxed as ordinary income. If you think you’ll be in a lower tax bracket when you retire, a traditional account may save you more.
• 401(k): A workplace retirement plan that lets you contribute directly from your paycheck, often with the benefit of an employer match. These are usually traditional (pretax), but some employers also offer Roth 401(k) options. 401(k)s are great if you want to take advantage of employer contributions and save consistently.
• IRA (Individual Retirement Account): You can open an IRA on your own, outside of work. IRAs are available as both Roth and traditional, giving you flexibility depending on your tax strategy. They are good for people who don’t have a 401(k) at work or who want to save more in addition to their workplace plan.
• Solo 401(k): For self-employed people or business owners with no employees (other than a spouse). It allows you to contribute both as an “employee” and as the “employer,” which means much higher contribution limits than a regular IRA.
• SEP (Simplified Employee Pension) IRA: Another option for self-employed people and small business owners. SEP IRAs allow for larger contributions than traditional IRAs, but only the employer can contribute.

There are many types of retirement accounts, each with different tax advantages and implications. Get the answers to your biggest tax questions. Book an appointment to talk taxes with the pros.