IRA Calculator

Calculate traditional IRA growth and tax savings over your retirement timeline.

Savings Plan

1%20%
1 yr40 yrs

Future Value

₹10,66,390

Total Invested

₹7,00,000

Total Returns

₹3,66,390

Wealth Multiplier

InvestedReturns

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IRA Calculator Formula & How It Works

Tax Savings = Contribution × Marginal Tax Rate | FV = PMT × [(1+r)ⁿ − 1] / r
  • 2025 limit: $7,000/year ($8,000 if 50+)
  • Deduction phases out at $79,000–$89,000 (single, covered by workplace plan)
  • Withdrawals taxed as ordinary income
  • Required minimum distributions (RMDs) start at age 73

Traditional IRA contributions may be tax-deductible depending on income and workplace plan coverage. Investments grow tax-deferred, but withdrawals in retirement are taxed as ordinary income. Required minimum distributions must begin at age 73. The immediate tax deduction makes traditional IRA attractive for those in higher tax brackets now.

IRA Calculator FAQs

Can I deduct IRA contributions from my taxes?

Depends on income and workplace plan: if you have no employer plan, contributions are fully deductible regardless of income. With a workplace plan, deductibility phases out at $79,000–$89,000 (single, 2025) or $126,000–$146,000 (married filing jointly).

What is the difference between IRA and 401(k)?

IRA: higher investment flexibility (any broker), lower contribution limit ($7,000), no employer involvement. 401(k): higher limit ($23,500), possible employer match, limited to plan's fund selection. Many people maximize 401(k) match first, then IRA, then more 401(k).

When must I take RMDs from my traditional IRA?

Required Minimum Distributions must begin April 1 of the year after you turn 73 (under SECURE 2.0 Act). RMD amount = account balance ÷ IRS life expectancy factor. Failing to take RMDs results in a 25% excise tax on the shortfall.

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