Home  >  Financial Articles and Q&A  >  What is a ROTH IRA Tax Credit?

What is a ROTH IRA Tax Credit?

Jan 04, 2012 by John from San Diego, CA in  |  Flag
2 Answers  |  6 Followers
Follow Question
6 votes

An IRA tax credit is a credit provided to a lower income earning tax payer for making a ROTH IRA contributions. The amount of the credit can range from 10, 20 or 50% up to $2,000 of your contribution. The percentage of the credit that you are entitled to is based on your annual adjusted gross income. This number can be found at the top of the second page of your 1040 tax return. For example a single filer with an adjusted gross income of $17,000 or less can claim a 50% credit on the first $2000 worth of contributions. This is a $1,000 tax credit! Remember a tax credit is different than a tax deduction. A credit is a dollar for dollar reduction of your tax liability, a tax deduction reduces your taxable income by the amount of the deduction and therefore reduces your tax liability.

1 Comment   |  Flag   |  Nov 13, 2012 from Wakefield, MA
kingsley

I am a private lender , Do you need a legit, honest, reputable and quick loan? I can help you with 100% guarantee loan, I am offering business and individual loan, More also we financing all kind of projects. For more info contact us today via Email: destinyfirmloan20@gmail.com

Flag |  7 days ago

1|600 characters needed characters left
2 votes

There is a tax credit for retirement plans in general if your adjusted gross income falls within the parameters, not necessarily just a ROTH IRA. See form 8880: http://www.irs.gov/pub/irs-pdf/f8880.pdf

1 Comment   |  Flag   |  Jan 09, 2012 from Lowell, MI
kingsley

I am a private lender , Do you need a legit, honest, reputable and quick loan? I can help you with 100% guarantee loan, I am offering business and individual loan, More also we financing all kind of projects. For more info contact us today via Email: destinyfirmloan20@gmail.com

Flag |  7 days ago

1|600 characters needed characters left