There are two misstatements in the “Tax Moves” column in July 18. The first mentions tax savings “in the year of the contribution.” In fact one has until the due date of the return without regards to extensions (usually April 15) to fund an IRA for the previous year.
Secondly, a $6,000 contribution for someone in the 24% bracket results in tax SAVINGS of $1,440, not a tax deduction of this amount. There is a big difference.
It should also be said that this would typically result in California tax savings of $500 or so depending on one’s state tax bracket.
Roger B Fox
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