Traditional IRA vs Roth IRA(p2)

Tax deductibility: a traditional IRA May deduct from an individual's income. The deductions may be limited if the individual or their spouse is covered by a retirement plan at their job or their income exceeds a certain amount.

Taxation of IRAs - traditional IRA contributions that are deducted on the taxpayers tax return are treated like similar to tax deferred contributions to a qualified retirement plan like a 401k. The contribution and earnings on those contributions are tax deferred.

They grow tax free until they are distributed. The deducted contribution to traditional IRA and their tax defer earnings are taxable income when distributed. When money is taken out it is treated as ordinary income.

Ex. You made 48k as teacher and made a 6K contribution to Roth IRA and zero to traditional IRA.

You can deduct $0.