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Contributions to a conventional IRA are generally deductible. However, the IRA deduction is usually minimized – or maybe eliminated – when you or your wife or husband have use of a 401(k) or other employer-sponsored retirement system and also your money is bigger than a specific amount. You shell out tax on all withdrawals from a standard IRA.
If not, the investment earnings part of early distributions are going to be subject to normal cash flow tax as well as the ten% early withdrawal penalty.
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