However, if youâre curious, there is a fascinating system behind ABA numbers. The ABA number is like an address that tells everybody where to find your account. ABA numbers are also known as routing transit numbers (RTNs). âABAâ is used because the American Bankers Association (ABA) assigns the numbers to banks.
In contrast to a traditional IRA, contributions to a Roth IRA are not tax-deductible. Withdrawals are tax-free under certain conditions (for example, if the withdrawal is only on the principal portion of the account, or if the owner is at least 59Â½ years old).
Contributions to a Roth or a 529 are not tax deductible (except at the state level for some 529 plans), though by contributing to a Roth IRA, you may qualify to earn the Saverâs Credit. 1  If you can save less than $5,000 a year, Roth contributions alone may be your best bet ($10,000 if both parents are saving).eâs contributed $2,000 to his Roth IRA every year since his daughter Sarah was born. Now that Sarah is 18, Danâs Roth IRA holds $36,000 in contributions and its total value is $68,000. Dan can withdraw up to $36,000 without taxes or penalties at any time for any reason, including to pay for Sarahâs college education.