With a Traditional IRA, you get to deduct the amount you contribute to the plan when you file your taxes. This deduction can reduce your overall taxable income, thus potentially lowering your final tax bill. Typically, you can deduct up to the maximum amount you’re allowed to contribute to...
The most likely source of income for most people is their 401(k), which wasn’t factored in here. Most 401(k) contributions are made pre-tax, meaning that they’ll be taxed when they’re withdrawn. That increases the amount of taxable income you’ll have in retirement. But there are ...
Non-Working Spouses Must Have a Spouse Earning Enough to Cover Contributions— A non-working spouse can contribute to a Spousal IRA as long as the working spouse has taxable earned income. The amount of combined IRA contributions in a tax year cannot exceed your total taxable income. ...