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Retirement tax questions
Yes, in 2020 if a persons modified adjusted gross income (MAGI) is equal or more than $139,000 ($140,000 is the 2021 limit) then you cannot contribute anything to the Roth IRA and any amount contributed would be excess contribution and hit with the 6% penalty.
But you can still contribute to a traditional IRA (depending on your income and if you are covered by a retirement plan this might not be deductible). If you want you can make it nondeductible so you can convert it later to a Roth IRA and won't have to pay taxes on the nondeductible part (basis). This is called backdoor Roth IRA conversion.
Please see How do I enter a backdoor Roth IRA conversion? for additional information.
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‎February 16, 2021
10:45 AM