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aylayne
New Member

We owe taxes. Can we open an IRA to alleviate those taxes?

If so how do we calculate how much to zero out the taxes we owe?
2 Replies
SweetieJean
Level 15

We owe taxes. Can we open an IRA to alleviate those taxes?

It is based on your marginal tax rate, subject to the maximum IRA allowed contribution.

So, a $5500 contribution can save you $1375 in Federal taxes if you are in the 25% bracket.

aylayne
New Member

We owe taxes. Can we open an IRA to alleviate those taxes?

So how about 28% bracket?  Is there a formula or calculation to decipher the savings?  PS Thanks!

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