If you make contributions to a traditional IRA which are not tax-deductible for whatever reason, how is this any different from contributing post-tax dollars to a regular taxable account? I thought the only difference was that IRA contributions were tax-deductible. In the case of IRA contributions which are not tax-deductible (due to income limits, e.g.), what is the advantage of an IRA?any earnings in the IRA are tax deferred (until withdrawal). This includes the earnings on the non-deductible contributions. The accounting gets messy though because the amount you take out during requirement is only taxable to the extent that you never paid tax on it before. In other words when you withdraw the non-deductible contribution is comes out of the IRA tax free because you already paid the tax on it. The amounts you contributed pre tax and the earnings get taxed upon withdrawal.