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Max Contribution to traditional IRA for self-employed retiree

1 reply
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I am over age 70 and have a business. My net income is $2531. What is the max I can contribute to my traditional IRA? Last year I contributed an excess of $54 and received a penalty. I did pull it back out so I am fine there but I don't want to make the same mistake again.

ThomasM125Answer

Alumni - Intuit

Your IRA contribution is limited by your earned income, so it would likely be $2,531, less your self-employment tax deduction if you had one, assuming the income is subject to self-employment tax. The income can't be from S corporation net income or non-self employment income from a partnership to qualify. To be sure, you should enter that amount in TurboTax and the program will inform you if it is not allowed, based on the other information on your return and your answer to the questions in the program.

[Edited 2/24/22 at 4:52 PM PST]

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ThomasM125Answer

Alumni - Intuit

Your IRA contribution is limited by your earned income, so it would likely be $2,531, less your self-employment tax deduction if you had one, assuming the income is subject to self-employment tax. The income can't be from S corporation net income or non-self employment income from a partnership to qualify. To be sure, you should enter that amount in TurboTax and the program will inform you if it is not allowed, based on the other information on your return and your answer to the questions in the program.

[Edited 2/24/22 at 4:52 PM PST]

**Say "Thanks" by clicking the thumb icon in a post. **Mark the post that answers your question by clicking on "Mark as Best Answer"