I contributed about $600 to my Roth IRA in 2006. I don't get taxed on that do I? I heard I get a refund for 15% of that or something. Can someone please clear that up for me. Also, if it matters, I'm self-employed.
Thanks!
2007-01-30 06:16:01 · 3 answers · asked by Chris R 1 in Business & Finance ➔ Taxes ➔ United States
Roth IRA deposits are fully taxed -- you don't get a deduction for it -- but they accumulate tax free. You don't need to record this on your taxes.
2007-01-30 06:25:10 · answer #1 · answered by Bostonian In MO 7 · 0⤊ 0⤋
You do not get a deduction for a contribution to your Roth IRA. However, there is an often overlooked tax credit you may be eligible for, depending on your filing status, income level, and whether or not you received any retirement distributions during the year.
Check out form 8880, Credit for Qualified Retirement Savings Contributions. That is the link I put below.
2007-01-30 07:21:54 · answer #2 · answered by Take Responsibility 2 · 1⤊ 0⤋
Your contribution to a Roth IRA is with after tax dollars. This means that you do not get a deduction for the amount contributed. However, the money your contribution earns is tax free (not subject to tax) if you take the money out when you reach retirement age.
2007-01-30 06:22:39 · answer #3 · answered by jseah114 6 · 0⤊ 0⤋