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New Member
posted Jun 6, 2019 11:08:16 AM

My employer provides 401K and I didnt contribute. Does that make me covered by a retirement plan at work? Can I still contribute max for IRA and get the tax benefits?

My employer provides 401K and I didnt contribute. Does that make me covered by a retirement plan at work? Can I still contribute max for tradidional IRA and get the tax benefits?

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2 Replies
Employee Tax Expert
Jun 6, 2019 11:08:19 AM

If you made no contributions to your 401k at work, and no contributions were made on your behalf by your employer, then you are not considered an active participant and can contribute to a IRA. 

Be certain that your employer has not contributed. Check with your employer and also that the 'retirement plan' box on your W-2 is unchecked.

Note: If your spouse is covered by a retirement plan, your IRA deduction can be limited. See link below for contribution limits.

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

New Member
Jun 6, 2019 11:08:21 AM

You are a participant in the plan even if you did not contribute in the eyes of the employer.  Because you had no payroll deductions you may still contribute to an IRA up to $5500 by 17 April 2018 and take an IRA deduction for 2017.  If you were over 50 years of age you may contribute an additional catch up contribution of $1000.