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Wikipedia about Roth IRA says about its differences from traditional IRA

Transactions inside a Roth IRA (including capital gains, dividends, and interest) do not incur a current tax liability.

What does a current tax liability mean?

Do transactions inside a traditional IRA incur a current tax liability?

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  • That sentence in Wikipedia is badly misplaced in the "Differences from Traditional IRAs" section since it invites the inference that,_ in contrast to Traditional IRAs_, transactions within a Roth IRA do not incur a current tax liability. Transactions within a Traditional IRA also do not incur a current income tax liability. Commented Jan 16, 2017 at 14:31

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Current tax liability means that you'd have to pay taxes on the capital gain, dividend or interest incurred by the transaction. In some cases, there may be a portion withheld to cover the taxes in some cases.

Do transactions inside a traditional IRA incur a current tax liability?

No, though there is a deferred tax liability as all distributions from a Traditional IRA are taxed as ordinary income.

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