2024 IRA Deduction Limit Glitch?

[tez15]

It appears that turbotax is not calculating the IRA deduction correctly.  For a married couple, filing jointly, 1 spouse eligible for a retirement plan, with an AGI below $123,000, the full deduction ($7000 or $8000 depending on age) should be eligible, but the program is phasing out the deduction for the retirement eligible spouse as if the AGI is above $123,000.

[AnnetteB6]

To take a closer look at the situation and try to explain it or determine if there is something that needs the attention of the development team, it would be very helpful to have a diagnostic copy of your tax file.  The diagnostic file will not contain personally identifiable information, only numbers related to your tax forms.  

If you would like to provide us with the diagnostic file, follow the instructions below and post the token number along with which version of TurboTax you are using and what states you are filing in a follow-up thread.  

Use these steps if you are using TurboTax Online:

• Sign in to your account and be sure you are in your tax return.
• Select Tax Tools in the menu to the left.
• Select Tools.
• Select Share my file with agent.
• A pop-up message will appear, select OK to send the sanitized diagnostic copy to us.
• Post the token number here. 

If you are using a CD/downloaded version of TurboTax, use these steps:

• Select Online at the top of the screen.
• Select Send Tax File to Agent.
• Click OK.
• Post the token number here.

[dmertz]

The $123,000 threshold for deductibility of the traditional IRA contribution only applies to the spouse that is not covered by a workplace retirement plan.  The phase-out of the deduction for a traditional IRA contribution made by the spouse who is covered by a workplace retirement plan is a Modified AGI occurs between $77,000 and $87,000.

If the wrong spouse is being subjected to the lower phase-out range, make sure that you have marked the W-2 as belonging to the correct spouse.