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New Member
posted Jun 6, 2019 5:25:29 AM

If I obtain a ira does the amount I purchase deduct from what I owe at a rate of 1 to 1

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1 Best answer
Level 15
Jun 6, 2019 5:25:31 AM

No.   A deductible Traditional IRA reduces your taxable income, not your tax.  You tax savings, if any, depend on your margional tax rate.   If you are in the 20% tax bracket, for example, a $1,000 deduction could save $200 in taxes.

1 Replies
Level 15
Jun 6, 2019 5:25:31 AM

No.   A deductible Traditional IRA reduces your taxable income, not your tax.  You tax savings, if any, depend on your margional tax rate.   If you are in the 20% tax bracket, for example, a $1,000 deduction could save $200 in taxes.