@h091320 wrote:
I am retired. I receive monthly retirement payments from a pension plan from another company where I used to work. years ago.
I received a final long term bonus from the company I retired from this year paid as w2 compensation. I am no longer part of their 401k program.
I have some personal income now after retirement and I would like to make an IRA contribution. Can I make deductible IRA contribution?
You can contribute to an IRA up to the amount of compensation (payment for work performed) that you report on your tax return. Compensation is W-2 box 1 wages (minus box 11 payments) and Schedule C net self-employment income minus half your SE tax.
If you have a W-2 for 2022 that shows compensation for work performed (that may include the bonus) then you can make a 2022 IRA contribution up to the amount of the compensation, or up to $7000 (if you are over age 50), whichever is less.
You can make a contribution in 2023 and designate it as a 2022 contribution if you make it before April 18 and you tell the bank in advance that it is a 2022 contribution and not 2023.
Then, whether or not you can make a 2023 contribution will depend on if you have compensation from working in 2023.
