Truth 5. IRA deductions
One of the primary attractions of a traditional IRA is the ability to deduct your contributions. This enables you to pay no income tax on the money you earned and contributed to your traditional IRA at the time that you contributed to your traditional IRA. Instead, income taxes are deferred until you withdraw the money from your traditional IRA, most likely years later in retirement.
However, one of the unfortunate misconceptions about deducting contributions to a traditional IRA is that you may deduct the entire amount of your contribution in all circumstances. Unfortunately, this is not true. If neither you nor your spouse actively participated in an employer-sponsored retirement plan, you are eligible ...
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