I'm self employed and pay roughly $4000 a quarter in Social Security taxes. If I put that money into an IRA throughout the year, would that lower my annual taxes?

Adlai - you are self emoployed so making a IRA contribution will not reduce your self employment tax which is calcualted on your net self employment income, however by contributing to a traditional IRA or a SEP(higher contribution limit and flexibility) you will reduce your Federal and State Income taxes. I would estimate you will save 30% for every dollar you contribute. The SEP contribution is not due until the tax return is filed including extensions - So if your 2011 retrun is on extesnion you can still make a SEP contribution up to the filing date or October 15th. I recommend making them throughout the year as you are dollar cost averaging into your investments. Good Luck. Mark Schreiber CPA