If it's within the IRA or other retirement accounts like 401ks, any gains from the money in the account is not taxable until you start to withdraw from 59 1/2. But if you withdraw before that time, the money you take out will be taxed at your tax rate plus a 10% penalty. Which means you'll only get 50-60% and the rest goes to pay for taxes.

NO. In fact, based on your income you can actually get a tax credit. This is in addition to contributions being tax deferred. I'm looking at line 17, 20, and 21 of my 1040A and line 21 shows the AGI with the IRA subtracted from income. Stocks gains traded within an IRA are considered as part of the IRA and won't push you over any limit. What will push you over the limit is money that you invest yourself. You're safe. Good luck to you.

capital gains on assets already in a Roth IRA are not taxed until withdrawn. capital gains are NOT earned iincome.

I'm have just started researching IRAs and long term investing. This is one thing that is confusing me. I know you cannot have a Roth IRA if you earn too much money, but does that include money gained from profitable investments within your IRA or just income outside of it? Could profits from stocks traded within your IRA push you over the limit?