How to Reduce Taxes If Most of Your Savings Are in a Traditional IRA

IRA withdrawals are taxable—but planning can soften the hit.

Smart planning can cut taxes on traditional IRA withdrawals. William Potter/Shutterstock

A traditional individual retirement account (IRA) can serve as a powerful savings vehicle. It allows you to make tax-deductible contributions. And as you contribute to the account, your money benefits from compound interest.

But once you start cracking open that nest egg, Uncle Sam comes to collect.