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bi0hm
September 27, 2023
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IRA

  • September 27, 2023
  • 1 reply
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To. which type of IRA can a contribution be made to reduce annual income, a regular IRA, or a Roth IRA?

Thanks,

DF

 

Best answer by Cindy4 12

Hi @bi0hm !

 

You would contribute to a traditional IRA to reduce your taxable income now.  This defers tax to when you take the distributions later in life, when you are theoretically older and making less money, so you may be in a lower tax bracket.

 

Roth IRAs are not tax deductible, but the distributions are not taxable as long as you meet the requirements.

 

Here are a resource regarding IRAs:

https://ttlc.intuit.com/turbotax-support/en-us/help-article/retirement-benefits/difference-traditional-ira-roth/L6fAa7w6j_US_en_US

 

Hope this helps!

Cindy

 

1 reply

Cindy4 12
Cindy4 12Answer
September 27, 2023

Hi @bi0hm !

 

You would contribute to a traditional IRA to reduce your taxable income now.  This defers tax to when you take the distributions later in life, when you are theoretically older and making less money, so you may be in a lower tax bracket.

 

Roth IRAs are not tax deductible, but the distributions are not taxable as long as you meet the requirements.

 

Here are a resource regarding IRAs:

https://ttlc.intuit.com/turbotax-support/en-us/help-article/retirement-benefits/difference-traditional-ira-roth/L6fAa7w6j_US_en_US

 

Hope this helps!

Cindy

 

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