whats the maximum allowable IRA tax deduction for man and wife with no house and no dependants?

Question

how does an IRA work anyway and where do you start? without messing with these dayum professionals?

Answer 1

There are many types of IRA accounts.

Two of the most common are Traditional IRA and Roth IRA. Since you want a tax deduction contributing to your Traditional IRA will accomplish that. Note that you're taxed when you withdraw the money at age 59 1/2. With a Roth IRA you use post-tax money so you're taxed today but you're not taxed when you withdraw it.

The maximum you can each do is $4000 this year or $5000 each if you're both age 50 and above.

Side Note -
When I did my taxes this year I was going to owe $750. I had forgot about the $3,000 I contributed to my Traditional IRA last year. After entering that data I only owed $217.

Answer 2

You have until April 17 to open and fund an IRA for 2006. At this point, I'd go to a local bank and open an IRA savings account or CD. The folks at the bank probably have the basic knowledge to answer your questions.

If you are under 50 and do not have a pension plan at work, you can contribute $4,000 to a deductible IRA. This will reduce your taxable income by $4,000. Your spouse can also open an IRA even if she has no income.

If you are age 50 or over, the maximum contribution is $5,000.

Be sure to specify that your contribution is for 2006 if you want to deduct it on your 2006 tax return.

Answer 3

Speaking as a dayum professional, your house and dependents have nothing to do with an IRA. Each person can contribute up to $5000 in an IRA. This is if you are not covered by a pension plan at work, and don't make too much money. If you are over 50 the amount goes up.

Answer 4

Well, if you don't want to deal with any "dayum professionals" you'll just have to skip on IRAs cuz you dang sure ain't going to pick one up down the 7-11 on the rack next to the Slurpee machine.