Roth vs Traditional vs Taxable Comparison (2026)

Compare the after-tax terminal value of the same annual contribution across a Roth IRA, a Traditional IRA, and a taxable brokerage account. The breakeven turns on a single question: is your marginal rate now higher or lower than the rate you expect at withdrawal?

Guidance, not advice. This calculator runs the rules as published, it doesn't assess your circumstances. Your actual tax may be affected by factors it doesn't cover (deductions, credits, filing status nuances, state-specific adjustments). Always seek financial or tax advice from a qualified CPA, Enrolled Agent, or tax attorney, or contact the IRS. Read our editorial scope →

Your numbers

Same gross contribution into each account each year. Returns, tax drag, and exit taxation differ by vehicle.

Current age

Filing status

MAGI

Annual contribution

Capped at IRA limit ($7,500 effective).

Current marginal rate: 24.0%

Retirement marginal rate: 22.0%

Expected return: 7.0%

Time horizon: 10 years

Long-term cap gains rate at withdrawal

You (or your spouse) are an active participant in an employer retirement plan

Winner at 10 years: Roth IRA

Terminal after-tax value of the same annual contribution stream.

Roth IRA

$110,877

Fully allowed

Traditional IRA

$86,484

Fully deductible

Taxable Brokerage

$105,300

Annual drag at 2.0% dividends + 10.0% turnover, LTCG 15.0% at exit

Breakeven heuristic

You expect a lower rate in retirement (24.0% → 22.0%), which favors the Traditional IRA: deduct now at the high rate, pay later at the low rate. The taxable brokerage only wins on short horizons, with very low turnover, or when both IRAs are unavailable due to phase-outs.

Tax year 2026 · USD · OBBBA permanent law

Formula: Terminal value = annuity-due future value of annual contribution at the assumed return rate, with Roth tax-free at withdrawal, Traditional taxed at retirement marginal rate (basis recovered for non-deductible portion), and Taxable applying annual dividend + turnover drag plus LTCG on remaining unrealized gain.

Assumptions

IRA contribution cap: $7,500 base ($8,500 at 50–59 and 64+, $9,500 at 60–63 SECURE 2.0 enhanced).
Roth MAGI phase-out: $150k–$165k single/HoH, $236k–$246k MFJ/QW, $0–$10k MFS.
Traditional IRA deductibility phase-out applies only if you (or spouse) are an active participant in an employer plan.
Same contribution assumed each year for the full horizon — no inflation indexing of the cap, and no future tax-law changes modeled.
Taxable account drag assumes ordinary rates on dividends and LTCG on realized + exit gains. Qualified dividend treatment would lower the drag.
Marginal rates are simple effective rates including state where you choose to layer it in — the model is account-mechanic, not bracket-aware.
Backdoor Roth pro-rata math assumes zero pre-tax Traditional IRA balance. Existing rollovers can make the conversion partially taxable.

Estimates only — not tax advice. Brackets, deductions and thresholds reflect the locked 2026 federal configuration. State amounts use each state's posted 2026 top-line rules and may differ from a full state-form computation. Always confirm complex situations with a qualified CPA, EA, or tax attorney.