Respectfully, there is no tax avoidance with an IRA. With a traditional IRA, one "defers" the taxes on the savings. Pre-tax money goes into the account, the account grows, one then pays taxes on the withdrawl. As I plan on buying our retirement house with my traditional IRA (I've been contributing into for the past 35 years), I WISH it wasn't federally taxed as this would be enough to buy my boat!
With the Roth IRA, one saves into the account with 'after-tax' monies.
Either way, Uncle Sam gets his share!
Jim
Jim,
Well, don't believe that's the whole story.... the Roth IRA give one a fairly substantial tax savings, and is especially handy for retirement, when you want non taxable income.
There may be some other IRAs that give that advantage, too.
There are other forms of creating income that is totally non taxable. Yes, you can legally keep it all yourself..... (maybe)