Final answer:
Traditional IRAs differ from Roth IRAs in that contributions may be deductible, there is a penalty for not taking RMDs, and there are no income limits for making contributions.
Step-by-step explanation:
Among the options provided, the features that are true of traditional Individual Retirement Accounts (IRAs) but not of Roth IRAs are:
- Contributions may be deductible: With traditional IRAs, contributions made may be tax-deductible, depending on income, filing status, and other factors.
- There is a 50% penalty for failing to take the required minimum distribution (RMD): Traditional IRAs have RMDs starting at age 72, and failing to take them can result in a hefty 50% penalty on the amount that should have been withdrawn.
- There are income limits for making contributions: Roth IRAs have income limits that restrict the ability to contribute for higher-income earners, while traditional IRAs do not have such limits on contributions, though deductibility may be affected by income levels.
The option that contributions to traditional IRAs are always deductible is not correct, as it can depend on various factors including income level and coverage by a workplace retirement plan.