Question

Why did my total tax due not decrease for opening an IRA? I opted for the $6000 IRA contribution to decrease amount due, but it didn't didn't give me a $1500 credit?

Forum|Forum|4 years ago
March 6, 2022
2 replies
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While putting in the option on the return that I was going to open an IRA for $6000 before April, it stated after submitting, the amount would change, but it didn't.

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A

AnnetteB6

The effect on your tax return for opening an IRA depends on a few factors.

If you elected to open and fund a Traditional IRA, then you must be eligible to make a deductible contribution. If the contribution is deductible, the amount you contribute will reduce your Adjusted Gross Income (AGI) and your taxable income. This would reduce your taxes.

If you chose either a non-deductible contribution to a Traditional IRA or a contribution to a Roth IRA, there will be no effect on the bottom line of your return.

Any of these contributions to an IRA may make you eligible to claim the Saver's Credit if qualified and your income is within the limits allowed for the credit.

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S

SweetieJean

Employee

Did you choose a Traditional IRA (not a Roth)?