The Roth IRA enables investors to make non-deductible contributions into a retirement account whose earnings grow tax free and can be withdrawn tax free at retirement.1, 2 In contrast, traditional IRA earnings are taxed when withdrawn.

  • You may withdraw earnings tax free and penalty free beginning at age 59½ if the account is at least five years old.1
  • You may withdraw contributions tax free and penalty free at any time.1
  • There is no required minimum distribution at age 70½.
  • You may contribute to a Roth IRA as long as you want, provided you have compensation.
  • The beneficiaries of your Roth IRA will not have to pay income tax on the assets in your account if it was open for at least five years.1, 2
  • You must receive taxable compensation.
  • Modified Adjusted Gross Income (MAGI)3 limits: $173,000 for couples, $110,000 for singles for 2012; $178,000 for couples, $112,000 for singles for 2013.
  • Eligibility phases out at $183,000 for couples, $125,000 for singles for 2012; $188,000 for couples, $127,000 for singles for 2013.
Investment Choices Choose from over 10,000 mutual funds, as well as publicly traded stocks and bonds.
Minimum Initial Investment $2,500
Annual Contribution Limits4
Annual Contribution Limits for Individuals Annual "Catch-Up" Contribution Limits for Individuals Age 50 and Older (in addition to annual contribution):
2012 $5,000 2012 $1,000
2013 $5,500 2013 $1,000
  • Tax-free, penalty-free withdrawals if you are at least age 59½ and the account is at least five years old.1
  • Withdrawals for special purposes may be permitted prior to retirement.
Distributions Minimum distributions are not required at any age. However, if your estate includes Roth IRA assets after your death, your beneficiaries will have to take required minimum distributions.
Service Fees An annual IRA custodial fee may apply.
Secure Online Account Access Simply create a User Name and Password and Log In for secure online account access, to:
  • View account balances
  • Conduct online transactions
  • View online statements
  • Perform account maintenance, such as changing your address
  • And more.

1State and local taxes may apply.
2Estate tax may apply.
3Modified Adjusted Gross Income (MAGI) is your Adjusted Gross Income (AGI) with standard deductions included.
4Annual contributions to a Roth IRA are not tax deductible.

IRS Circular 230 Disclosure: American Century Companies, Inc. and its affiliates do not provide tax advice. Accordingly, any discussion of U.S. tax matters contained herein (including any attachments) is not intended or written to be used, and cannot be used, in connection with the promotion, marketing or recommendation by anyone unaffiliated with American Century Companies, Inc. of any of the matters addressed herein or for the purpose of avoiding U.S. tax-related penalties.

This information is for educational purposes only and not intended as tax advice. Please consult your tax advisor for more detailed information or for advice regarding your individual situation.

Brokerage Services are provided by American Century Brokerage, a division of American Century Investment Services, Inc., registered broker/dealer, member , .