US Roth IRA Calculator

A Roth IRA is a US retirement account you pay into with money that has already been taxed. It grows without yearly tax, and in retirement everything comes out tax-free, as long as you follow the 59½ and 5-year rules. A traditional IRA works the other way round: you may get a tax deduction now, but every dollar is taxed as income when you take it out.

The formula

each year: balance = (balance + what you put in) × (1 + return)
balance at retirement = balance now × (1 + return)^years + yearly amount × ((1 + return)^years − 1) ÷ return × (1 + return)
today's dollars = balance ÷ (1 + inflation)^years
taxable account: the same, with return × (1 − tax on growth)
traditional IRA after tax = contributions part × (1 − tax rate in retirement) + yearly tax saving invested in a taxable account
reduced limit = limit − limit × (MAGI − start of range) ÷ size of range, rounded up to $10 (at least $200)

Worked example

You are 30, have $10,000 in a Roth IRA, put in $6,000 at the start of each year and expect 7% a year until you retire at 65: 35 years. 1.07³⁵ = 10.6766, so the $10,000 grows to $10,000 × 10.6766 = $106,766. The yearly $6,000 grows to $6,000 × (10.6766 − 1) ÷ 0.07 × 1.07 = $887,481. Together that is $994,247. You paid in $10,000 + 35 × $6,000 = $220,000, so $774,247 is tax-free growth. At 2.5% inflation, 1.025³⁵ = 2.3732, so it is worth about $418,947 in today's dollars, and 4% a year gives $39,770 of tax-free income.

The same money in a taxable account, losing 15% of its growth to tax each year, earns 7% × 0.85 = 5.95% and reaches $776,497: $217,750 less. In a traditional IRA at a 22% tax rate now and in retirement, the contributions part ($887,481) is taxed $195,246 on the way out; adding the $106,766 and the yearly $1,320 tax saving invested at 5.95% ($154,197) gives $953,198 after tax, $41,049 less than the Roth. With equal tax rates the two IRAs would match if the tax saving could grow tax-free too; the Roth wins here because the saving is taxed in a normal account.

2026 limits

You can put up to $7,500 into all your IRAs for 2026, or $8,600 if you are 50 or older by the end of the year. You can't put in more than your taxable pay; a spouse filing jointly can use the couple's joint pay. Contributions for 2026 can be made until the tax filing deadline in April 2027.

Example: single with a MAGI of $160,000 is $7,000 into the $15,000 range, so the limit is cut by $7,500 × 7,000 ÷ 15,000 = $3,500, leaving $4,000.

The 5-year rule and taking money out

• Your own contributions can come out at any time, with no tax or penalty.
• Earnings are tax- and penalty-free once you are 59½ and five tax years have passed since January 1 of the year of your first Roth IRA contribution. Before then, earnings may be taxed and hit with a 10% penalty, with some exceptions (such as a first home, up to $10,000, or disability).
• Roth IRAs have no required minimum withdrawals while you are alive, so the money can keep growing tax-free.

Backdoor Roth IRA

If your income is over the limit, you can put money into a traditional IRA without a deduction and convert it to a Roth; conversions have no income limit. If you hold other pre-tax IRA money, part of the conversion is taxed under the pro-rata rule, so check with a tax adviser. Choose "I'll use a backdoor Roth" in Advanced mode to ignore the income limit.

2026 limits and phase-out ranges are from the IRS (irs.gov, "Amount of Roth IRA contributions that you can make for 2026"); they usually change each year. Returns are assumed to be steady every year, and the taxable account is taxed on all its growth each year, which is a simple, cautious view. Not tax advice.