Traditional IRA

Potential for tax-deferred growth

  • Use the IRA Selector tool to see if you are eligible for a Traditional or a Roth IRA
  • Investment earnings generally grow on a tax deferred basis; pay taxes generally only when distributions are taken
  • Make tax-deductible contributions, depending on whether you (or your spouse) is a participant in an employer sponsored qualified retirement plan, your tax filing status and your modified adjusted gross income2
  • Automate your retirement investing with Core Portfolios (low $500 minimum)
  • Enjoy fast, easy withdrawals at age 59½ with free cash management features3
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annual contributions
(if under age 50)

The lesser of (a) $7,000 for 2024 ($6,500 for 2023), or (b) your taxable compensation for the year.

annual contributions
(if age 50 or older)

The lesser of (a) $8,000 for 2024 ($7,500 for 2023), or (b) your taxable compensation for the year.

Why open a Traditional IRA?

A Traditional IRA may give you a potential tax break because tax deductible contributions can lower annual taxable income.
Compare investment accounts to see if a Traditional IRA account may be right for you.


Tax-deductible contributions

Contributions may be tax-deductible depending on whether you (or your spouse) is a participant in an employer sponsored qualified retirement plan, your tax filing status and your modified adjusted gross income.


Access

You may be eligible to take penalty tax-free distributions for a qualified first time home purchase, qualified higher education costs, or certain major medical expenses.4 Ordinary income taxes will apply to the taxable portion of your IRA distributions.


No annual IRA fees and no account minimums

Transaction fees, fund expenses, brokerage commissions, and service fees may apply.


Access to a wide range of investment choices

Choose from a wide range of stocks, bonds, options, 7,000+ mutual funds, and ETFs.

Start investing today

Enjoy $0 commissions on online US-listed stock, ETF, mutual fund, and options trades with no account minimums.1

 

Trade more, pay less

With E*TRADE from Morgan Stanley, you pay $0 commissions for online US-listed stock, ETF, mutual fund, and options trades. Here’s a quick overview of our clear, competitive per-trade pricing.1

Stocks

$0

ETFs

$0

Mutual Funds

$0

Bonds

$1.00

per bond for online secondary market trades ($10 minimum, $250 maximum)7

Options

50¢ - 65¢

per contractd1

Futures

$1.50

per contract, per side —plus fees5

Traditional IRA FAQs

See all FAQs

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General:

  • Must be 18 years of age or older with taxable compensation
  • If you or your spouse is covered by an employer sponsored qualified retirement plan, (such as 401(k) plan, including plans sponsored by self-employed individuals) and your MAGI (Modified Adjusted Gross Income) exceeds certain thresholds, the deductibility of your Traditional IRA contributions for federal income tax purposes may be reduced or eliminated.
  • To apply online, you must be a US citizen or resident
  • Can open and make a contribution to your Traditional IRA for a tax year at any time during the tax year or by your individual federal tax return filing deadline (not including extensions). This date is generally April 15 of each year. Applications postmarked by this date will be accepted.

Single Filers:

  • If taxpayer participates in an employer-sponsored retirement plan, and taxpayer’s MAGI is $77,000 or less in 2024, taxpayer may be eligible to deduct the entire contribution. If taxpayer’s MAGI is more than $77,000 but less than $87,000 in 2024, taxpayer may be eligible to deduct part of the contribution. Taxpayer is not eligible to make a tax deductible contribution if MAGI is $87,000 or more in 2024.

Joint Filers:

  • If taxpayer participates in an employer-sponsored retirement plan, and taxpayer’s MAGI is $123,000 or less in 2024, taxpayer may be eligible to deduct the entire contribution. If taxpayer’s MAGI is more than $123,000 but less than $143,000 in 2024, taxpayer may be eligible to deduct part of the contribution. Taxpayer is not eligible to make a tax deductible contribution if MAGI is $143,000 or more in 2024.
  • If taxpayer does not participant in an employer-sponsored retirement plan, but taxpayer’s spouse does, then the MAGI limits are different. If taxpayer’s MAGI is $230,000 or less in 2024, taxpayer may be eligible to deduct the entire contribution. If taxpayer’s MAGI is more than $230,000 but less than $240,000 in 2024, taxpayer may be eligible to deduct part of the contribution. Taxpayer is not eligible to make a tax deductible contribution if MAGI is $240,000 or more in 2024, and taxpayer’s spouse participates in an employer-sponsored retirement plan.

An investor can contribute to an IRA account by transferring funds online from a bank or brokerage account, sending a check, or completing a wire transfer. For more information about ways to make a deposit to an account, see the Help topic, Contribute to an IRA account. 

An investor is allowed to contribute 100% of earned income up to the annual contribution limit. View IRA Contribution Limits and Deadlines to learn more. 

Determining if an investor can deduct all or part of their Traditional IRA contribution is based on whether they (or their spouse) have a retirement plan at work, their tax filing status, and modified adjusted gross income (MAGI). To learn more about the amount of your contribution that can be deducted, use the IRA Selector or view IRA Contribution Limits and Deadlines, and speak with your tax advisor.

This is a common myth about retirement investing. An investor may still contribute to an IRA even if they participate in an employer-sponsored retirement plan. However, they may not be able to deduct a Traditional IRA contribution if they exceed certain income limits. View IRA Contribution Limits and Deadlines to learn more.

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Roth IRA8

Tax-free growth potential retirement investing

Pay no income taxes or tax penalties on qualified distributions if you meet certain requirements.

Rollover IRA

Consider rolling over your old 401(k) plan assets to an E*TRADE from Morgan Stanley IRA

Consolidate assets from a former employer’s retirement plan.

Core Portfolios

Automated investment management

Get a diversified portfolio that’s monitored and managed for a low annual advisory fee of 0.30% and $500 minimum.d1