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And if I do file the money I make as self-employment income, I will be able to contribute this amount into an IRA, correct?

That's basically right. But there's a slight complication. If you file self-employment income, you'll also have to pay social security taxes. Self-employment income gets reported on Schedule C, and the thing to do there is to list your expenses. (For example, if you earn money by lawn care, perhaps you have costs such as the purchase of a weed whacker, costs for lawn-mower maintenance, gasoline, etc.) The costs are subtracted from the gross income to yield your net income. Taxwise, self-employment is a bit more complicated than "regular" employment. (But only a bit.)

--SirTas
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