The Traditional IRA is the most common type of Individual Retirement Arrangement (IRA).  Why?  Well, it is probably because most people rollover their employer’s pre-tax retirement account into a Traditional IRA.  The Traditional IRA offers the advantage of providing a tax deduction for those who qualify.  As a result, it is very appealing to those wanting to pay themselves instead of the IRS.

A Traditional IRA is a type of individual retirement account in which you can make pre-tax contributions.  The investments in the account grow tax-deferred.  Then, you pay income tax on withdrawals at your regular tax rate.  Withdrawals taken before reaching the age of 59.5 are subject to an early-withdrawal penalty.

The Rules

Publication 590-A and Publication 590-B explain the details of IRAs including:

  • Setting up an IRA
  • Contributing to an IRA
  • Transferring money or property to and from an IRA
  • Handling an inherited IRA
  • Receiving distributions (making withdrawals) from an IRA
  • Taking a credit for contributions to an IRA
  • A comparison of traditional and Roth IRAs

Traditional IRAs (like Roth IRAs) have a contribution limit for 2021 of $6,000 if you are under 50 and $7,000 of your age is 50 or over.

To decide if a Traditional IRA is right for you, ask your competent tax advisor.  When you are ready to move forward and open an account contact us at uDirect IRA Services Toll-Free at (866) 447-6598 or by email at

To open an account, we need:

1) Application (Click Here)
2) Copy of your driver’s license or passport
3) Check for $50 for the set-up fee (made payable to uDirect IRA Services) or pay on PayPal
4) Copy of the statement from your current IRA or other retirement account.
5) W-9 form HERE
6) Provide a username for your online account. This cannot be your email address.