I made contributions of $1200 to a traditional IRA last year. After entering my IRA balance and basis it tells me I made an excess contribution of $1013. How is that possible when the maximum allowable amount for someone over 50 is $7000?
How much earned income did you have? From W2 box 1 and self employment Schedule C Net Profit? Do you have enough Net Profit? You can only contribute up to your net profit reduced by the deduction allowed for one-half of your self-employment taxes. See IRS publication 590 http://www.irs.gov/pub/irs-pdf/p590a.pdf
So check 1040 Schedule 1 line 15. You have to deduct that amount from your Schedule C Net Profit. That will give you the allowed contribution for self employment & 1099NEC income.
I expected after entering my IRA contribution, basis amount, and IRA balance from last year to be told that none of it was deductible. My taxable income is over $100,000.
Your traditional IRA contribution can be limited if you make over $68,000 (single filer) or $109,000 (married filing joint) and you have a retirement plan at your salary job (see if the retirement box is checked on your W-2 form). You can learn more here: IRA contribution if have retirement plan