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Retirement Beginner: Introduction to Individual Retirement Accounts (IRAs)

Introduction to Individual Retirement Accounts How You Can Fund Your IRA How to Contribute to an IRA How and When IRA Contributions Can Be Deducted from Taxable Income Limits on Deducting IRA Contributions if You Are Single or Married and Filing Separately Limits on Deducting IRA Contributions If You Are Married and Filing Jointly How IRAs Are Taxed Taxing of Deductible and Non-Deductible IRA Contributions Taxes on Excess IRA Contributions IRA Rollovers Premature Withdrawals and Insufficient Distributions from IRAs Summary of Individual Retirement Accounts
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Taxes on Excess IRA Contributions

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Taxes on Excess IRA Contributions

Holders of IRAs are not allowed to contribute more than the maximum amount. Those who do will be assessed a 6 percent tax on any excess amount. If an excess remains in the account for following years, it will be taxed in those years as well.

Of course, you cannot deduct excess contributions from your taxable income.