search4answers
  • Finance
    The 6 Things You Should Know About A Company Before…
  • Finance
    The Best 4 Credit Cards For Travel Rewards
  • Finance
    The Easiest Ways To Save $1,000 Without Even Realizing It
search4answers
    • Health
      • ADHD in Adults

        ADHD in Adults

      • What Causes Prostate Cancer?

        What Causes Prostate Cancer?

      • What Are The Types Of Lymphoma

        What Are The Types Of Lymphoma

      • Overview of Lymphoma

        Overview of Lymphoma

      • 6 Products You Can Use Instead Of Deodorant

        6 Products You Can Use Instead Of Deodorant

      • 9 Signs and Symptoms of Cancer

        9 Signs and Symptoms of Cancer

    • Finance
      • The Best Three E-commerce Website Builders

        The Best Three E-commerce Website Builders

      • 5 Best Free Business Checking Account Options

        5 Best Free Business Checking Account Options

      • HR Managers Salary Expectations

        HR Managers Salary Expectations

      • What You Can Do To Ease Being Unemployed

        What You Can Do To Ease Being Unemployed

      • What You Need for a Car Title Loan

        What You Need for a Car Title Loan

      • How to Apply for an Installment Loan

        How to Apply for an Installment Loan

    • Mortgage
      • Home Equity Conversion Mortgage (HECM): Explained

        Home Equity Conversion Mortgage (HECM): Explained

      • What Can you Do to Avoid Mortgage Foreclosure

        What Can you Do to Avoid Mortgage Foreclosure

      • The 4 Best Ways to Spend your Home Equity Loan

        The 4 Best Ways to Spend your Home Equity Loan

      • 5 Ways you Can Boost your Home Equity

        5 Ways you Can Boost your Home Equity

      • Comparing Mortgage Lenders

        Comparing Mortgage Lenders

      • What is Escrow?

        What is Escrow?

    • Auto
      • 5 Previously Expensive Cars You Can Now Buy for Less…

        5 Previously Expensive Cars You Can Now Buy for Less…

      • Look Out for These Problems Before Buying a Used Car

        Look Out for These Problems Before Buying a Used Car

      • Save Money On Your Car Insurance

        Save Money On Your Car Insurance

      • Top Myths and Facts About 2016 GMC Trucks

        Top Myths and Facts About 2016 GMC Trucks

      • Can You Trust Self Driving Cars?

        Can You Trust Self Driving Cars?

      • The Top 5 Minivans With Style

        The Top 5 Minivans With Style

    • Business
      • Small Business Internet Providers: 4 Great Options

        Small Business Internet Providers: 4 Great Options

      • Top 5 Mistakes While Creating A Resume

        Top 5 Mistakes While Creating A Resume

      • All-Natural Pest Control Options You Must Try

        All-Natural Pest Control Options You Must Try

      • How To Save Money With A New Startup Business

        How To Save Money With A New Startup Business

      • The Best Jobs for Great Typists

        The Best Jobs for Great Typists

      • Bankruptcy and Business: How Does it Work?

        Bankruptcy and Business: How Does it Work?

    • Medical
      • Be Pulse Aware About Atrial Fibrillation

        Be Pulse Aware About Atrial Fibrillation

      • Factors To Consider When Buying An Electric Wheelchair

        Factors To Consider When Buying An Electric Wheelchair

      • Your Guide To Metastatic Melanoma

        Your Guide To Metastatic Melanoma

      • To Flu Shot, or Not to Flu Shot

        To Flu Shot, or Not to Flu Shot

      • Living Hep C

        Living Hep C

      • Symptoms and Signs of Bone Cancer

        Symptoms and Signs of Bone Cancer

    • Tech
      • What Is Field Service Management?

        What Is Field Service Management?

      • Cloud security managed service

        Cloud security managed service

      • Best HEPA Air Purifiers for Home

        Best HEPA Air Purifiers for Home

      • Find The Best Cell Phone Plan For You

        Find The Best Cell Phone Plan For You

      • Before Online Dating There Was Video Dating

        Before Online Dating There Was Video Dating

      • The Five Best Online Dating Sites

        The Five Best Online Dating Sites

    • Travel
      • Helpful Tips to Get a Green Card Through Family Members

        Helpful Tips to Get a Green Card Through Family Members

      • 4 Ways to Securing a Green Card

        4 Ways to Securing a Green Card

      • If You Need to Renew or Replace a Green Card

        If You Need to Renew or Replace a Green Card

      • International Travel Regulations for Green Card Holders

        International Travel Regulations for Green Card Holders

      • Learn How To Maintain Green Card Status

        Learn How To Maintain Green Card Status

      • A Summary of Permanent Resident and Green Card Status

        A Summary of Permanent Resident and Green Card Status

      How Do IRA Contributions Affect Your Taxes? Find Out Here

      by Stephanie Donnely

      One key factor that you should always put into consideration whenever you are making investment strategies is how the strategies are going to affect your taxes. There are still lots of factors that are involved and need to be kept in mind, and in all this, your least expectations is to make investments that will demand of you to pay huge amounts of taxes that will weigh down heavily the general value of the investments you make.

      IRA are traditional investment accounts meaning this is the money you get your hands on after a good numbers of years. And with that in mind, the last thing you would want is to have all your retirement money falling into the hands of the government and leave you with nothing. And this urgently calls for your complete understanding of how making IRA contributions will affect your taxes for you to be on the safer end.

      To begin with, a traditional IRA has a tax limit that is deductible. This means that when you submit your contributions to your traditional account with IRA, you are at liberty to make claims for deductions of the money you contribute if at all you and your better half have an active participation in making the investments ( this basically means that if your spouse won’t make any contribution to the IRA account, there is no possibility for you to pay twice the contribution whenever you are using both of the accounts).

      However, you should note that you cannot make deductions for all of your contribution from the net income. To get an accurate figure of the exact amount of contribution you are able to deduct, you have to know your overall filing status as well as your modified adjusted gross income. As soon as you’ve gotten this, you can now easily determine how much deductions you can make to pay your taxes from your net income.

      As of now in 2014, if you are in the age bracket of 49 and below, you have the right to deduct as much as $5,500 from your net income but if you are 50 and above, you can get upto $6,500. Any amount of cash you pay as contribution to your retirement account is always above the amount that is allotted and it is categorized as income.

      Apart from the extra money you send to your IRA account, you are not going to experience any kind of strains when feeding your traditional IRA. Although you should understand that when you are making withdrawals from your account, you will have to pay taxes. But the good thing about this is that you no sort of paperwork is going to be required when withdrawing your money. All that is needed is just for you to get your 1040 or the 1040A form and basically fill in the information that is needed directly.

      When it is time for you to withdraw the money from your account, the income that was not taxable back then is now taxed. And if you were to pay tax for all the money in the account, your retirement fund will greatly depreciate. And that is why you will only be taxed on every withdrawal you make.

      Whatever the amount you withdraw, that exact sum of money is considered as income and will be taxed like it. You need to be completely aware of what tax bracket you are in because all the money you end up paying as tax solely depends on what category you fall into. If you don’t want to be overcharged for having slightly higher amount of money in your account, you should be keen on the amount in your account.

      Photo by Alan Cleaver / CC by

      Posted on May 22, 2023
      Privacy Policy | Terms Of Use | Contact