For any Traditional IRA deduction, you must have earned income. If you do, there are a couple of possibilities. If you (and/or your jointly-filing spouse) weren't covered by an employer-sponsored or self-employed retirement plan like a 401(k), your entire Traditional IRA contribution is deductible.
But if you (and/or your jointly-filing spouse) were covered by an employer-sponsored or self-employed retirement plan in 2023, the amount you can deduct depends on your tax filing status and modified adjusted gross income (MAGI).
If your MAGI is:
- Below the phase-out range, your entire contribution is deductible
- Above the phase-out range, you can't deduct anything
- Within the phase-out range, you can make a partial deduction (we'll calculate this for you)
Here are the MAGI phase-out ranges for tax year 2023 if you were covered by a retirement plan at work:
- Single, head of household, or married filing separately (not living with spouse): The phase-out range is $73,000 - $83,000
- Married filing jointly or qualified widow(er): The phase-out range is $116,000 - 136,000
- Married filing separately (living with spouse): The phase-out range is $0 – $10,000
If you weren't covered by another retirement plan at work, but your spouse was, and you're:
- Filing jointly: the phase-out range is $218,000 - $228,000
- Filing separately (living with spouse), the phase-out range is $0 – $10,000
