Am I paying taxes twice on Roth IRA?

[Matthew Hintzke]

Years ago when I was a bit more naive in my financial knowledge I opened up a Roth IRA Investement account with Schwab. Over a years I have added little bits of money here and there mostly to play around with the market and get my feet wet. I have been funding this Roth IRA via a manual transfer from my Checking account which is all money that was already taxed. I was thinking about it, and I didn't realize this entire time that I might have been getting taxed twice on this money since a Roth IRA taxes you "on the way in" right?

However, I looked at my statements and account and couldn't find anything that talked about the amount I was taxed, nor did I ever notice a deposit getting taxed ($1000 deposit went into the account as $1000). So does Schwab just assume this money is already taxed since its not coming directly from payroll? If I had a Traditional IRA whould this work any differently since you aren't supposed to get taxed until "the way out"?

I guess I am just trying to understand these 2 types of accounts a little more. Thanks for any insight!

[Andrew Baker]

A better question might be, why am I investing in an After-Tax vehicle that I can't touch until I retire instead of investing my money in something that I CAN CONTROL, and that also defers capital gains tax (via a 1031 exchange)? Not to mention the benefits of leverage, appreciation, depreciation, and cash flow. :)

401(k)s and Roth IRAs are invested primarily into paper assets (i.e. the stock market), which we all found out in 2008 are actually very risky and give us no control over our investments.

Check out "Rich Dad, Poor Dad" by Robert Kiyosaki. His books will blow your mind. Then combine that knowledge with BP's books on property investment. OMG!