Traditional and Roth IRA tax FAQ

Traditional and Roth IRA contributions must be made by the tax-filing deadline: April 15, 2026, for 2025 contributions.

Contributions for the prior year can be made via Automated Clearing House until market close, 4 p.m. ET, on the tax-filing deadline.

• For 2025, the maximum contribution limit is $7,000 or 100% of taxable compensation, whichever is less.
• For 2026, the maximum contribution limit is $7,500 or 100% of taxable compensation, whichever is less.
   

IRA owners who are age 50 or older by the end of the taxable year can make additional catch-up contributions of up to $1,100 annually.

Roth IRA contributions are not tax-deductible.

Traditional IRAs contributions may be deductible, based on:

• The IRA owner’s filing status
• Their MAGI for the tax year
• Whether the IRA owner or spouse is covered by an employer-sponsored retirement plan
   

For current eligibility requirements, review “Deductible contributions” in the IRA comparison table.

You can claim a nonrefundable tax credit for contributions if you are eligible.

For current eligibility requirements, review “Tax credit for contributions” in the IRA comparison table.

IRA contributions are reported on Form 5498, which is available by May 31.

Form 5498 is sent only for accounts that had contributions for the applicable tax year.

Note: Form 5498 is not required to be filed with your tax return.

Log in to your account and go to Statements & Tax Forms. Click on the applicable tax year to access the desired tax forms.

Watch How to view and download statements and tax forms for a tutorial.

IRA rollovers can be direct or indirect.

For indirect rollovers, the IRS requires the following:

• IRA owners must roll over assets within 60 calendar days of receipt 
• If an indirect rollover is from IRA to IRA, only one rollover is allowed per consecutive-12-month period, regardless of the number of IRAs owned. This limitation includes IRAs the investor owns with Capital Group or other companies.
   

Rollovers that do not meet IRS guidelines can be subject to penalties. Consult a tax advisor for additional guidance. 

• A rollover distribution is reported to the IRS on Form 1099-R. The tax forms are issued in January for distributions taken during the prior year.
• A rollover contribution is reported to the IRS on Form 5498. The tax forms are issued in May for rollover contributions made during the prior year.
   

Note: A transfer of assets is not tax reportable. If a distribution or contribution is treated as a transfer, a tax form isn’t generated.

Since you have until the tax-filing deadline in April to make contributions to IRAs and Education Savings Accounts, Capital Group must wait until after the tax-filing deadline to send these forms. Form 5498-ESA is sent in April, and Form 5498 (for IRAs) is sent in May. As a reminder, you are not required to attach a copy of Form 5498 or Form 5498-ESA to your income tax return.

Distributions to IRA owners age 59½ or over are considered normal distributions and therefore not subject to IRS early distribution penalties.

All distributions are reported on form 1099-R, and it’s the owner’s responsibility to determine the taxable amount.

Note: Roth IRA distributions from earnings are tax-free if your initial contribution to the account was made at least 5 years ago and you meet one of the following conditions:

• You’re age 59½
• You’re disabled
• You’re purchasing a home for the first time (up to $10,000)

For traditional IRAs, nondeductible contributions are not subject to taxes when withdrawn; however, deductible contributions are subject to taxes.

For Roth IRAs, distributions are tax-free if the first contribution was made at least 5 years before and the investor is at least 59½, is purchasing a first home or is disabled or deceased.

Distributions to IRA owners under the age of 59½ are considered early distributions. In addition to being subject to taxes on the taxable amount, early distributions are subject to a 10% early distribution penalty, unless an exception applies.

The IRS early distribution penalty does not apply if the distribution falls under certain exceptions. These exceptions are referred to as 72(t) provisions because they fall under Internal Revenue Code (IRC) Section 72(t). Some (but not all) examples of distributions that are exempt from the early distribution penalty include:

• Beneficiary distributions
• Disability distributions
• Substantially equal periodic payments
• Certain medical expenses*
• Health insurance premiums during unemployment*
• First-time home purchase expenses (up to $10,000 per individual)*
• Qualified higher education expenses*
• Distributions made in connection with federally declared disasters (up to $22,000 per individual)^*†
• Distributions for unforeseeable or immediate financial needs related to necessary personal or family emergency expenses (up to the lesser of $1,000 or the excess of your account balance over $1,000)^*†

* Capital Group does not require documentation on these distributions. If made before age 59½, they are reported to the IRS as early distributions, with no known exception (IRS Code 1) on Form 1099-R. Consult a tax advisor to determine whether a distribution falls under a particular exception.

^† Distribution amounts can be repaid to an IRA or retirement plan that accepts rollovers within 3 years of the date the distribution was received. 

IRA distributions are reported on Form 1099-R, which is available in mid to late January.

Form 1099-R is provided only for accounts that had distributions for the applicable year.

IRA distributions, even if all or part of the distribution is rolled back in, are required to be reported on Form 1099-R.

Form 5498 reflects contributions, including rollovers, made to IRA accounts. Generally, the amount rolled over will not be subject to taxes or an early distribution penalty. 

Log in to your account and go to Statements & Tax Forms. Click on the applicable tax year to access the desired tax forms.

Watch How to view and download statements and tax forms for a tutorial.