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Level 4
posted Mar 25, 2021 7:45:52 AM

IRA Contribution

I have a W-2 from a non qualified pension for 2020 which says I have $11,000 in the "wages" box  (Box 1) so I thought I was eligible to contribute to an IRA, but Turbo Tax is saying I can't since I don't have any "earned income."

(I didn't otherwise have earned income in 2020.)   Can I contribute - without penalty - or not?

 

Thanks for your help.

0 2 379
2 Best answers
Level 15
Mar 25, 2021 7:50:21 AM

The amount on a W-2 that will support an IRA contribution is the amount in box 1 minus the amount in box 11.  Deferred compensation does not support an IRA contribution.

Level 4
Mar 25, 2021 7:52:00 AM

Thanks.   I didn't realize you had to deduct Box 11.   Saved me from a mistake.

2 Replies
Level 15
Mar 25, 2021 7:50:21 AM

The amount on a W-2 that will support an IRA contribution is the amount in box 1 minus the amount in box 11.  Deferred compensation does not support an IRA contribution.

Level 4
Mar 25, 2021 7:52:00 AM

Thanks.   I didn't realize you had to deduct Box 11.   Saved me from a mistake.