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Get your taxes done using TurboTax
Hi Danarand1,
First, I just want to say congratulations on the new job!!
It is possible to be able to contribute to both a 401k plan and an IRA in the same year. However, your individual circumstances may limit or disallow any deduction for the IRA contribution.
Since you had an employer with a 401k plan during 2021, you must abide by the 2021 IRA deductions limits with regarding to the modified AGI since you (or spouse) were covered by a retirement plan at work during the same tax year.
In order to receive the full deduction for IRA contribution in 2021 while having a retirement plan at work, your MAGI must be $66,000 or less if you file single or head of household. There is a partial deduction up to $76,000. At $76,000 you will receive no deduction for the IRA contribution. In this circumstance, Married filing jointly filers get a full deduction with a $105,000 MAGI and is completely phased out at $125,000.
You can read more about the income limitations of IRA contributions when you have a retirement plan at work on the IRS website at: https://www.irs.gov/retirement-plans/2021-ira-deduction-limits-effect-of-modified-agi-on-deduction-i...
For even more information, please see publication 590-A. At this time, the link is for 2020 and has not been updated with the 2021 limitations referenced above. https://www.irs.gov/publications/p590a
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