IRC §408 · 26 U.S.C. §408
IRC §408: Individual Retirement Accounts
IRC §408 governs every IRA — traditional, Roth, SEP, and SIMPLE: who may contribute, how much, what’s deductible, and when the money must come out. The personal retirement statute.
What it governs
- Traditional (deductible, taxable later) vs Roth (after-tax, free later)
- Indexed annual caps across all your IRAs combined — plus 50-plus catch-up
- Deductibility and Roth eligibility phase out with income when a workplace plan covers you
- RMDs at 73/75 for traditional, SEP, and SIMPLE — never for the Roth owner
In the GuideFull treatment in Chapter 8 of the Guide (principal treatment) and Chapter 14 — THE TAX CUTTERY® Guide to Federal Income Taxation, Professional Edition (564 pages, 24 chapters).
Related sectionsIRC §401 — the workplace plan it complements · IRC §402 — how IRA distributions are taxed
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Questions this section answers
- Traditional or Roth IRA?
- High bracket now, lower later: traditional deducts today. Low bracket now or decades of growth ahead: Roth. Income too high for either directly? The backdoor (nondeductible contribution plus prompt conversion) bypasses both limits.
- Can I have a 401(k) and an IRA?
- Yes — but workplace coverage phases out traditional-IRA deductibility and Roth eligibility at higher incomes. The contribution itself is always allowed; the tax benefit is what phases.
- What is a SEP IRA vs SIMPLE IRA?
- SEP: employer-only contributions up to 25% of pay for the self-employed and small firms. SIMPLE: employee deferrals plus mandatory employer match, for firms under 100 employees. Both live under §408’s umbrella with their own subsections.
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The Guide treats 149 Code sections across 24 chapters — every claim verified against primary sources.
Get the Guide — $299