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posted Jun 1, 2019 10:58:52 AM

I am 62 not employed. I did consultancy work as an independent contractor, received a 1099, with earning of $15,000. Can I make a tax deductable contribution to an IRA?

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1 Best answer
Intuit Alumni
Jun 1, 2019 10:58:53 AM

Yes, assuming you have a sufficient profit on your Schedule C. Since at most, you probably only have $3,000 of Federally taxable income, you may not have a large benefit. It will not reduce Self-employment tax.

Traditional IRA: For a Traditional IRA, once you reach the year in which you turn age 70 ½ you are no longer eligible to make a Traditional IRA contribution.

If you haven't made your contribution yet, you have until 4/15/19 do so.

Here's how you report the contribution:

  • Federal Taxes tab (Personal in the Self-Employed/Home& Business version)
  • Deductions and Credits 
  • Continue or I'll Choose What I Work On (if they show up)
  • Scroll to Retirement and Investments
  • then, Traditional and Roth IRA Contributions

2 Replies
Intuit Alumni
Jun 1, 2019 10:58:53 AM

Yes, assuming you have a sufficient profit on your Schedule C. Since at most, you probably only have $3,000 of Federally taxable income, you may not have a large benefit. It will not reduce Self-employment tax.

Traditional IRA: For a Traditional IRA, once you reach the year in which you turn age 70 ½ you are no longer eligible to make a Traditional IRA contribution.

If you haven't made your contribution yet, you have until 4/15/19 do so.

Here's how you report the contribution:

  • Federal Taxes tab (Personal in the Self-Employed/Home& Business version)
  • Deductions and Credits 
  • Continue or I'll Choose What I Work On (if they show up)
  • Scroll to Retirement and Investments
  • then, Traditional and Roth IRA Contributions

Level 15
Jun 1, 2019 10:58:54 AM

If the deduction would result in only a small amount of tax savings on your 2018 tax return, your modified AGI would likely permit you to make a Roth IRA contribution.  It would be better to forgo the small immediate tax savings and contribute to a Roth IRA instead for the opportunity of tax free growth.