Yes, you can have both a traditional and Roth IRA open at the same time, but there is one hard limit: your total contributions across both accounts cannot exceed the annual contribution limit set by the IRS.

The IRS treats a traditional IRA and a Roth IRA as a single retirement savings vehicle for contribution purposes. If the limit for your age is $7,000 in 2024, that $7,000 is the maximum you can put into both accounts combined in that year — not $7,000 into each one. You can split that money however you want between the two accounts, but you cannot exceed the total.

The contribution limit changes each year and depends on your age. People age 50 and older can contribute an additional $1,000 as a catch-up contribution. The IRS publishes the current year's limit on its website each January.

Key Takeaways

  • Your combined contributions to a traditional IRA and Roth IRA cannot exceed the annual IRS limit, which was $7,000 for 2024 (plus $1,000 if you are 50 or older).
  • You can split your contributions between the two accounts in any proportion you choose, as long as the total does not exceed the limit.
  • A traditional IRA may reduce your tax deduction if you are covered by a workplace retirement plan and earn above a certain income threshold.
  • Roth IRA contributions are limited by income — if you earn too much, you cannot contribute directly to a Roth, though a backdoor Roth conversion may still be an option.
  • You will owe taxes on any untaxed money in your traditional IRA when you convert it to a Roth, even if you are converting only part of your balance.

Why someone would want both accounts

Having both accounts gives you flexibility in how you manage taxes across your working years and in retirement. A traditional IRA lets you deduct contributions now and pay taxes later. A Roth IRA lets you pay taxes now and withdraw money tax-free later. If your income or tax situation changes year to year, you might want to use both.

For example, if you have a year with lower income, you might contribute more to a Roth that year. In a year with higher income, you might contribute to a traditional IRA to reduce your taxable income. Over time, this mix can lower your total tax bill across your lifetime.

Income limits that affect your choices

Roth IRA contributions phase out as your income rises. The income threshold depends on your filing status and changes each year. If your income is above the limit, you cannot contribute directly to a Roth IRA, though you may be able to use a backdoor Roth conversion (converting money from a traditional IRA to a Roth).

Traditional IRA contributions have no income limit, but if you are covered by a workplace retirement plan — such as a 401(k) or 403(b) — the tax deduction for your traditional IRA contribution phases out above a certain income. This means you could contribute to a traditional IRA, but the contribution would not reduce your taxable income. The IRS publishes these income thresholds each year on its website.

The tax consequence of mixing accounts

If you own both a traditional IRA and a Roth IRA and you convert money from the traditional to the Roth, the IRS uses a pro-rata rule. This rule treats all your traditional IRAs (including SEP IRAs and SIMPLE IRAs) as one account for tax purposes, even if they are at different banks.

Here is how it works: if your traditional IRA holds $10,000 in pre-tax contributions and $40,000 in after-tax contributions, and you convert $10,000 to a Roth, the IRS calculates what percentage of that $10,000 is pre-tax money. In this example, 20 percent ($2,000) would be pre-tax, so you would owe income tax on $2,000 of the conversion. You cannot cherry-pick only the after-tax money to convert.

This rule catches many people off guard. If you have a large traditional IRA with mostly pre-tax money and you want to do a backdoor Roth conversion, the pro-rata rule will trigger a tax bill on part of the conversion. Some people solve this by rolling their traditional IRA into a workplace 401(k) plan first (if their employer allows it), which removes the traditional IRA from the pro-rata calculation.

How to track contributions across both accounts

You are responsible for tracking your own contributions. The IRS does not automatically know how much you put into each account. When you file your tax return, you report your IRA contributions on Form 1040 and Schedule 1. If you contribute to both a traditional and Roth IRA in the same year, you report the combined total.

Keep records of every contribution you make — the date, the amount, and which account it went into. If you convert money from a traditional IRA to a Roth, that conversion is reported separately on Form 8606. Your IRA custodian (the bank or brokerage holding your account) will send you a statement each year showing contributions and conversions, but you should verify it matches your own records.

What happens if you contribute too much

If you contribute more than the annual limit across both accounts, the IRS charges a 6 percent excise tax on the excess amount each year it remains in the account. The tax applies every year until you remove the excess.

If you catch the mistake before you file your tax return for that year, you can request a return of excess contributions from your IRA custodian. The custodian will remove the excess and any earnings on it. You will owe income tax on the earnings portion, but you can avoid the 6 percent penalty if you act quickly enough. After your tax return is filed, the process becomes more complicated and may require amending your return.

Frequently Asked Questions

Can I contribute to both a traditional and Roth IRA in the same year?

Yes, but your total contributions to both accounts combined cannot exceed the annual IRS limit. You can split the money between them however you want — for example, $4,000 to a traditional IRA and $3,000 to a Roth IRA — as long as the total does not exceed the limit.

Do I have to report both accounts on my tax return?

You report your total IRA contributions on Form 1040 and Schedule 1, regardless of how many accounts you own. If you do a Roth conversion, that is reported separately on Form 8606. Your custodian sends you statements, but you should keep your own records of contributions and conversions.

What is a backdoor Roth, and does it work if I have a traditional IRA?

A backdoor Roth is a conversion of after-tax money from a traditional IRA to a Roth. It works, but the pro-rata rule applies: if your traditional IRA holds any pre-tax money, part of the conversion will be taxable. Many people roll their traditional IRA into a 401(k) first to avoid this tax.

If I have both accounts, which one should I withdraw from in retirement?

Roth withdrawals are tax-free and do not count toward required minimum distributions until after the account owner dies. Traditional IRA withdrawals are taxed as income and trigger required minimum distributions starting at age 73. Most people withdraw from their traditional IRA first to manage their tax bracket, then use the Roth for tax-free withdrawals later.

Can I have a traditional IRA and a Roth IRA at different banks?

Yes, you can hold accounts at multiple institutions. However, for contribution limits and the pro-rata rule, the IRS treats all your traditional IRAs as one account and all your Roth IRAs as one account, regardless of where they are held. Keep careful records of all accounts and their balances.