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Are Traditional IRA contributions tax-deductible?

Traditional IRA contributions can be fully or partially tax-deductible, depending on three main factors:

1. Your tax filing status
2. Your income level (MAGI)
3. Whether you or your spouse participates in a workplace retirement plan

If neither you nor your spouse has a retirement plan at work, your contributions are typically 100% deductible, no matter your income. If either of you has access to a workplace plan, then the IRS applies income-based deduction limits. These limits phase out your deduction as your income increases.

A tax-deductible contribution lowers your taxable income for the year, which may reduce your overall tax bill. This is one of the main benefits of Traditional IRAs. Even if you don’t qualify for a deduction, you may still choose to contribute for the long-term tax-deferred growth potential.