Last minute deduction

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Can i place 4000$ in a 401k to avoid oweing 3500 in taxes owed, filed jointly married, wifes 401k is 6grand maxed, but mine has had no contributions, and i have a traditional 401k.

SusanY1

Employee Tax Expert

If it is a 401(k) offered by you employer, it is too late to make an employee contribution. If it is a solo 401(k) and you are your own employer, then there's still a little bit of time.

If you have a traditional IRA you can still make a contribution (until April 15) but whether or not it will be deductible and lower your tax depends on your income and whether you or your spouse are covered by an employer-sponsored plan. See IRA deduction limits.

Note that a contribution to a 401(k) or IRA is not a dollar-for-dollar reduction in tax as it lowers your taxable income but isn't a tax credit.

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