Traditional IRA: This type of individual retirement account allows your earnings to grow tax-deferred. In other words, the funds in your traditional IRA are generally not taxed until they are withdrawn from the account in retirement. Contributions may be tax-deductible depending on the individual tax payer's situation. Any contributions to this account must cease when the account owner reaches the age of 70½.
Roth IRA: Roth IRAs are funded with after-tax dollars, meaning taxes on the money deposited into these account have already been paid. Roth IRA contributions are not tax-deductible, but qualified withdrawals from these accounts are tax-free. Roth IRA owners can continue to contribute to this account after the age of 70½.
SEP IRA or Simplified Employee Pension IRA: This type if IRA is very similiar to the Traditional IRA, but was created specifically for self-employed individuals and small business owners. It offers tax benefits to both employees and employers. Contributions to SEP IRAs are made by employers, and they have higher contribution limits than those of a Traditional IRA.
For more information on contributions, distributions and the tax treatment of these and other retirement accounts, please see the IRS website.