You are not mistaken. It is only early withdrawl of earnings that are
subject to income tax rate as well as the penalty. You would be surprised
that alot of people in the industry are not aware of this.
Dan M.

Ed wrote:

- quote -

I guess what I meant was that to the extent that the person cannot get the tax
deduction for a regular IRA contribution, (as long as they have qualifying income),
they could contribute to a ROTH from after-tax money.

Unless I am mistaken, you can withdraw contributions from a ROTH at any time
without tax or penalty. It is only *earnings made in a ROTH* that are
restricted regarding withdrawal.
Joe

"Joseph Weinstein" <joe[at]bea.com> wrote

- quote -

Unless it changed, distributions aren't qualified for 5 years and The tax
deduction would be gone.

Why not open a ROTH IRA, and
contribute to that with after-tax money?