Non-Qualifed Pension Earnings and IRA contribution

[donfuerst]

I have income reported every year on a W-2 from a non-qualified pension plan. That income was reported as wages prior to 2022. In 2022 it was reported on Schedule 1, line 8t. That income was my only earned income (W-2). In 2022, Turbo Tax said I was eligible for an IRA contribution. In 2023, I am in same situation, but Turbo Tax says I have no earned income and cannot make an IRA contribution. What changed?

[dmertz · Accepted solution]

When there is an amount in box 11 of your W-2, TurboTax asks whether the amount in box 11 represents a distribution from then nonqualified pension plan.  Answering incorrectly in your case will allow TurboTax to treat the amount in box 1 as being compensation that will support an IRA contribution.

Another possibility is that you are married, file jointly and your spouse had compensation that would support your IRA contribution.