Jill is 45 years old and thinks that her future tax rate will be lower than what she currently pays, so she wants to defer her taxes on her contributions of up to $5,500 in 2017. Which plan would allow her to meet her goals?
A traditional IRA is a form of personal retirement fund that allows tax advantaged growth in your earnings. Only when you make withdrawals after retirement, you pay taxes on your investment returns.
Advantages include:
You will subtract the full amount of your IRA allocation on your income tax return if you are not provided by a pension plan at work.
