My 401k started in March 2017 can i deduct IRA contribution for 2016?

[farhan_ahmad]

My 401k started in March 2017 can i deduct IRA contribution for 2016 that I made on 4/18/17 and apply to 2016?

My 2016 W2 box 13 does not show Retirement checkbox checked.

If it's relevant, IRA account was started in 2013.

[ChristinaS · Accepted solution]

Yes, as long as you have enough earned income in 2016, you can make an IRA contribution. If you had no retirement plan, its likely to be fully deductible (it might not be fully deductible if you have a spouse with a retirement plan).

https://www.irs.gov/retirement-plans/ira-deduction-limits

A 2016 IRA contribution is based on your 2016 income/ W2. This doesn't change because you are literally making the contribution in 2017. Your 2017 W2 and 2017+ 401(k) isn't a hindrance for 2016 taxes.

[farhan_ahmad]

Thanks for a quick response, I wasn't expecting a lighting fast reply that clearly addressed my concerns.

I do qualify based on other IRS rules (income and spouse status etc) posted on IRS, so this was the only unclear part which you have clarified well.

Thanks again.

[ChristinaS]

Why, thank you! I'm glad I crossed all the T's!