Estimate tax-free Roth IRA growth with MAGI phase-out limits and a head-to-head comparison against a taxable brokerage account.
Embeds 2026 IRS limits: $7,000 base contribution, $8,000 at age 50+, with phase-out ranges by filing status (Single/HoH $150k to $165k, MFJ $236k to $246k, MFS $0 to $10k). Compares Roth growth (tax-free) against an equivalent taxable account assuming a 25% annual tax drag and surfaces the Roth advantage in dollars and percent.
Disclaimer: Roth IRA withdrawal rules apply: 5-year rule for earnings, age 59 1/2 for full tax-free withdrawal. Phase-out limits adjust annually for inflation.
Calculator information
📋 How to use this calculator
- Enter current age, retirement age, and current Roth IRA balance in USD.
- Input annual contribution (2026 limit $7,000, or $8,000 if age 50+) and check MAGI against phase-out: Single $150-165k, MFJ $236-246k, MFS $0-10k.
- Set expected annual return (5-10%), inflation rate (2-3%), and contribution growth (or set to 0 if maxing out each year).
- Toggle 'Compare to Taxable Account' to see Roth advantage assuming 25% tax drag on dividends/capital gains in the alternative.
- View results in nominal and inflation-adjusted dollars; Roth withdrawals after age 59.5 and 5-year rule are 100% tax-free.
- Tip: If MAGI exceeds limits, use backdoor Roth conversion - contribute to non-deductible Traditional IRA, then convert to Roth.
🧮 Roth IRA Growth & Tax-Adjusted Comparison
FV_Roth = P(1+r)^n + PMT x [((1+r)^n - 1) / r]; FV_Taxable = same with r_effective = r x (1 - tax_drag)
- P: current Roth balance (after-tax dollars)
- PMT: annual contribution (limited to $7k base / $8k catch-up in 2026)
- r: gross annual return (decimal)
- tax_drag: ~0.15-0.25 on taxable account dividends/realized gains
- MAGI phase-out 2026: Single $150-165k (proportional reduction), MFJ $236-246k, MFS $0-10k
- Qualified withdrawal: age >= 59.5 AND account >= 5 years old
Roth IRA contributions (not earnings) can be withdrawn anytime tax-free and penalty-free. No required minimum distributions (RMDs) during lifetime.
💡 Worked example: 30-Year-Old Maxing Roth IRA to Age 65
Given:- Current age 30, retire at 65 (35 years)
- Current Roth balance $15,000
- Annual contribution $7,000 (maxed)
- Catch-up of $1,000 added at age 50 (15 years of $7k, 15 years of $8k)
- Expected return 7% nominal
- Single filer, MAGI $90,000 (under phase-out)
Steps:- FV of current $15k: 15,000 x (1.07)^35 = 15,000 x 10.68 = $160,198
- FV of $7k contributions for years 1-20 (30 to 50): 7,000 x [((1.07)^20 - 1) / 0.07] = 7,000 x 40.995 = $286,968, then grow 15 more years: 286,968 x (1.07)^15 = 286,968 x 2.759 = $791,628
- FV of $8k contributions for years 21-35 (50 to 65): 8,000 x [((1.07)^15 - 1) / 0.07] = 8,000 x 25.129 = $201,034
- Total nominal FV at 65: 160,198 + 791,628 + 201,034 = $1,152,860
- All withdrawals tax-free after age 59.5; compare to Traditional IRA where same balance would owe 22-32% federal tax on withdrawals
- 4% withdrawal: $1,152,860 x 0.04 = $46,114/year tax-free
Result: Projected $1.15M tax-free at 65, generating $46k/year tax-free retirement income (equivalent to ~$60k pre-tax in 22% bracket).
❓ Frequently asked questions
What is the 2026 Roth IRA contribution limit?
For 2026, the contribution limit is $7,000 for those under 50, and $8,000 for age 50+ (additional $1,000 catch-up). MAGI phase-outs reduce or eliminate contribution eligibility: Single $150,000-165,000 (full to zero), Married Filing Jointly $236,000-246,000, Married Filing Separately $0-10,000. The contribution deadline is the tax filing deadline (typically April 15 of following year). You can contribute to prior year until that date.
What is a backdoor Roth IRA?
A backdoor Roth is a legal strategy for high earners above the MAGI phase-out: (1) Contribute up to $7,000 to a non-deductible Traditional IRA; (2) Immediately convert to Roth IRA (no income limit on conversions). Tax owed only on any pre-tax balance and growth between contribution and conversion. Pro-rata rule applies if you have other pre-tax Traditional IRA balances, which can create unexpected tax. Consult a tax advisor.
When can I withdraw from a Roth IRA penalty-free?
Contributions (not earnings) can be withdrawn anytime, tax-free and penalty-free. Earnings are tax-free only if: (1) account is at least 5 years old, AND (2) you are at least 59.5, OR you qualify for an exception (first-time home purchase up to $10,000, disability, qualified higher education, etc.). Early withdrawal of earnings before meeting both criteria triggers 10% penalty plus income tax.
Roth IRA vs Roth 401(k) - which is better?
Roth 401(k) has higher contribution limits ($23,500 in 2026) and employer match (though match goes to pre-tax bucket). Roth IRA has more investment flexibility (any brokerage, any fund), no required minimum distributions during lifetime, and easier early withdrawal of contributions. Strategy for high earners: max out Roth 401(k) first for higher limit, then Roth IRA via backdoor for flexibility. Income limits don't apply to Roth 401(k) - anyone can contribute regardless of MAGI.
Are Roth IRA withdrawals really tax-free forever?
Yes, qualified withdrawals (after age 59.5 and 5-year rule) of both contributions and earnings are 100% federal tax-free. No taxes on dividends, capital gains, or appreciation during accumulation either. State taxes follow federal treatment in most states. Roth IRAs also have no required minimum distributions (RMDs) during the owner's lifetime, unlike Traditional IRAs which require RMDs starting at age 73. This makes Roth excellent for estate planning.
📚 Sources & references
Last updated: May 11, 2026