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Other financial discussions
@SLYKTAX wrote:
Still not too clear Sir. I assumed you said that IRA contribution which is pre-tax is the deductible and Roth is not. But why would someone want to put his non-deductible (after-tax) to his IRA to be constrained by RMD later instead of just putting into a stock investment account without being constrained by RMD?
Most people contribute to a Roth IRA for that reason. But their income might be too high to allow any Roth contribution so they make a non-deductible Tradition IRA contribution instead and then convert that to a Roth. That only works it that was the only money in the Traditional IRA.
Before Roth IRA's many people made non-deductible contributions so the tax would be lower on distributions after retirement and the earnings could grow tax free over the years so the earnings could produce more earnings.