AnnetteB6
Employee Tax Expert

Deductions & credits

The wording you referenced, 'your deduction may be limited', does indeed mean that a partial deduction may be allowed if your AGI falls within the phase-out range.  

 

However, given that you are considered to be covered by a retirement plan and you stated that your AGI is above the limits for taxpayer and spouse both covered by a retirement plan, there is no deduction allowed.  Unfortunately, the limitation is based on AGI being within a certain range, not on the period of time you were covered by a retirement plan.

 

You are still allowed to make a contribution to a Traditional IRA.  It just will not be deductible on your return.

 

@steph2

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