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dhamad18
New Member

What does it mean when it says Did you contribute to a qualified retirement plan in 2019?

And how do i know if i have a traditional or roth ira
1 Best answer

Accepted Solutions
KurtL1
Expert Alumni

What does it mean when it says Did you contribute to a qualified retirement plan in 2019?

qualified retirement plan is an investment plan offered by an employer that qualifies for tax breaks under the Internal Revenue Service (IRS). The plan will meet the requirement of a qualified retirement plan if the contributions are tax-deductible. An example would be a 401(k).

 

An individual retirement account (IRA) is not offered (with the exception of SEP IRAs and SIMPLE IRAs) by an employer.

 

When you make a contribution to a Traditional IRA you are making the pretax contribution. That means you are allowed to take a tax deduction for the contribution and the amount reduces the income taxed on your return. It is referred to as a tax deferred investment account

 

When you make a contribution to a Roth IRA you are making an after-tax contribution. The contribution is not tax deductible and does not lower your income taxed on your return.

 

Most financial institutions will designate in the account name if it is a Traditional IRA or a Roth IRA.

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1 Reply
KurtL1
Expert Alumni

What does it mean when it says Did you contribute to a qualified retirement plan in 2019?

qualified retirement plan is an investment plan offered by an employer that qualifies for tax breaks under the Internal Revenue Service (IRS). The plan will meet the requirement of a qualified retirement plan if the contributions are tax-deductible. An example would be a 401(k).

 

An individual retirement account (IRA) is not offered (with the exception of SEP IRAs and SIMPLE IRAs) by an employer.

 

When you make a contribution to a Traditional IRA you are making the pretax contribution. That means you are allowed to take a tax deduction for the contribution and the amount reduces the income taxed on your return. It is referred to as a tax deferred investment account

 

When you make a contribution to a Roth IRA you are making an after-tax contribution. The contribution is not tax deductible and does not lower your income taxed on your return.

 

Most financial institutions will designate in the account name if it is a Traditional IRA or a Roth IRA.

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
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