IRA Question

I have a question about a normal IRA (not Roth) . . . might be a dumb one but figured I'd throw it out there.  When they say you can contribute $5,000 tax free each year, when do you get that money back?

Does it reduce your taxable base when you file your annual return?

For instance, when I fund my 401k at work it comes directly out of my paycheck and taxes are not taken out.

However, for an IRA, I am putting $5,000 of money that has already been taxed into an account.  I'm assuming I just recoup this money when I file my return but wasn't 100% sure. 

Any help is appreciated. 

VH,

The questions are tough to answer but here goes-

You get the money back NORMALLY when you retire and draw retirement income, the age is like 62.5 but who knows what will change in 20 years. Now there are circumstances in which you can WD money, but that is too complicated, the money is meant for retirement.

Depending on your income bracket and if you contribute, a traditional IRA CAN be deductible, but you have to see if you meet the requirements. A ROTH IRA is never tax deductible, but you also dont have to pay taxes on it when you retire.

If that doesnt clear it up let me know.

If you can deduct it, you do it on your annual return so it reduces your AGI, and if that produces a refund then there it is.