Can I make my own investment in stocks or mutual funds to get the $3000 deduction, or do I specifically need to invest in a Roth IRA to receive the deduction?
by 
kishor
ANSWERS: 1
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A Roth IRA does not get you a deduction on your tax return. Roth IRA's are funded with taxed money, so that when you withdraw the money later the money you put in it is tax free - the earnings are not tax free. A traditional IRA is the one that gets you a tax deduction. This year the limit is $4000 and it must specifically be set up in a fund that is earmarked an IRA. There are a lot of different funds you can put your money in and still have the choice of where your funds are invested, but it has to be in an IRA so that the government can control withdrawals.
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