@acw380 wrote:
This was what prompted my original question. The account I want to start has a $5000 minimum so I would have to use my post-tax dollars in my bank account to fund it. I might be misunderstanding how people fund TIRAs. If a TIRA requires pre-tax contributions how would you be able to fund it unless the money is taking out of your pay check directly, before tax is applied? Again I am trying to take advantage of the AGI reduction of $6000 from my contributions to the account for the year (the max contribution limit).
"A traditional IRA is a type of individual retirement account in which individuals can make pre-tax contributions and the investments in the account grow tax-deferred. In retirement, the owner pays income tax on withdrawals from a traditional IRA."
The only time you can make truly pre-tax contributions via payroll deduction is to a qualified workplace plan like a 401k, 403b, or similar.
With any private or individual plan, the money comes from your after-tax dollars. You then can take a tax deduction on your tax return, if you meet income and other requirements. The tax deduction gives the same net result at the end of the year, but if the money is coming out of your paycheck, it is an after-tax deduction and not a pre-tax deduction.
