The IRA is a type of retirement account that allows individuals to save for retirement with tax-free growth or on a pre-tax basis. The two most common types of IRAs are the ROTH IRA and the SEP IRA. A ROTH IRA is an individual retirement account that is funded with after-tax dollars, meaning that contributions are not tax deductible but withdrawals are tax-free. A SEP IRA is a retirement plan that allows employers to make contributions to their employees' retirement accounts. Contributions to a SEP IRA are tax-deductible and withdrawals are taxed as ordinary income.