turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
Announcements
Close icon
Do you have a TurboTax Online account?

We'll help you get started or pick up where you left off.

Can a Michigan retired teacher receiving a pension still make a fully deductable traditional IRA contribution?

I receive a Michigan retired teacher pension reported on a 1099-R. My wife still works and is covered by Employer retirement plan. Can I contribute to a fully deductible traditional IRA (Spousal IRA)? The instructions ask this question that is somewhat unclear to me...

 

"Whether or not you can make a Deductible IRA Contribution depends on your Modified Adjusted Gross Income (MAGI) and whether or not you are "covered" by an Employer-Sponsored Retirement Plan (Retirement Plan Box Checked on Line 13 of your Form W2)."

 

I no longer work and do NOT receive a W2 form. I do receive a pension (reported on 1099-R) so I guess it boils down to this question...Am I considered "covered by an employee sponsored plan" even though I am no longer employed and have no W2? Or, can I take a fully deductible traditional IRA (Spousal IRA) subject income phaseout?

Connect with an expert
x
Do you have an Intuit account?

Do you have an Intuit account?

You'll need to sign in or create an account to connect with an expert.

1 Best answer

Accepted Solutions
MarilynG1
Expert Alumni

Can a Michigan retired teacher receiving a pension still make a fully deductable traditional IRA contribution?

No, you are not covered by an Employer plan, but what is most important is that you have Earned Income on your joint return to be able to make Deductible IRA Contributions. 

 

 

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

View solution in original post

3 Replies
MarilynG1
Expert Alumni

Can a Michigan retired teacher receiving a pension still make a fully deductable traditional IRA contribution?

You are correct, you can contribute to an IRA as long as you have Earned Income (which you do, as your spouse is working) and your MAGI does not exceed the limits.

 

Click this link for an article on Retirement Savings

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

Can a Michigan retired teacher receiving a pension still make a fully deductable traditional IRA contribution?

I want to focus my question a bit. Does the fact that I receive a pension mean that I am "covered by an Employer-Sponsored Retirement Plan ."? Or Not?

 

 Turbo tax literally asks the question "Are you covered by an Employer-Sponsored Retirement Plan?" That is the question I'm struggling with.

(If I were still working the answer would be YES, but now I'm not really covered but rather receiving the benefits of my pension).

Again I do NOT receive a W2 anymore because I am retired & receive pension on 1099-R.

 

Thank You!

 

 

MarilynG1
Expert Alumni

Can a Michigan retired teacher receiving a pension still make a fully deductable traditional IRA contribution?

No, you are not covered by an Employer plan, but what is most important is that you have Earned Income on your joint return to be able to make Deductible IRA Contributions. 

 

 

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
message box icon

Get more help

Ask questions and learn more about your taxes and finances.

Post your Question
Manage cookies