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pclark3
Returning Member

IRA Contributions

Can you take money from a savings account and make a traditional IRA Contribution to reduce AGI?

The money is not from any retirement fund, annuity or Social Security.

Thank you

9 Replies
VolvoGirl
Level 15

IRA Contributions

Yes if you have earned income from W2 wages or a Net Profit from self employment.  

pclark3
Returning Member

IRA Contributions

WOW. Thank you that was fast.

 

I did not earn any money from a W2 this year.

However, the money was earned in prior years, if that make sense.

 

Thank you

macuser_22
Level 15

IRA Contributions

It has to be 2020 taxable compensation - W-2 or net self-employed income.    (1040 line 1 and/or schedule 1 line 3 minus line 14 & 15).

**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
pclark3
Returning Member

IRA Contributions

Thank you

Line 1 contains the amount I contributed. 

I should be good correct???

Thank you very much 

macuser_22
Level 15

IRA Contributions

What income is on line 1 if you had no W-2?

**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
macuser_22
Level 15

IRA Contributions

Enter the IRA contribution in the interview and the last screen should tell you if you qualify or if it is an excess contribution.

 

Enter IRA contributions here:
Federal Taxes,
Deductions & Credits,
I’ll choose what I work on (if that screen comes up),
Retirement & Investments,
Traditional & Roth IRA contribution.

OR  Use the "Tools" menu  (if online version under My Account) and then "Search Topics" for "ira contributions" which will take you to the same place.

 

 

**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
pclark3
Returning Member

IRA Contributions

We did have a W2 for 2020.

I neglected to tell you that. Apologies.

Having the W2 showing earnings for 2020 is all I needed.

I just needed to be in the guidelines allowed for annual IRA contribution and the W2 needed to have at least that amount.

 

 

Thank you very much!!!

pclark3
Returning Member

IRA Contributions

Yep.

I did that, worked great.

I do indeed qualify.

Thank you for your responses.

macuser_22
Level 15

IRA Contributions

Glad it helped you.

**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
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