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del3684-
Level 1
June 4, 2019
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Open IRA account?

Want to find out if we can open an IRA account to reduce our tax burden? My wife was covered by a retirement plan at work for all of 2016.  I was retired for most of 2016 and went back to work part time in Sep of 2016.  For the months of Sep to Dec 2016 I was also covered by a retirement plan.  Will that 4 month period that I was I was also covered by a retirement plan exclude us from using the IRA account to help reduce our tax burden?
    ChristinaSAnswer
    Alumni - Intuit
    June 4, 2019

    Yes- It might.

    If you have the retirement plan checkbox on a W2, that impacts the entire year. You don't separate times of the year worked for this purpose, so your ability to make a deductible contribution will be based on both of you having retirement plans in 2016.

    You can receive a full deduction if your MAGI is no more than $98,000.

    https://www.irs.gov/retirement-plans/plan-participant-employee/2016-ira-contribution-and-deduction-l...

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    1 reply

    ChristinaSAnswer
    Alumni - Intuit
    June 4, 2019

    Yes- It might.

    If you have the retirement plan checkbox on a W2, that impacts the entire year. You don't separate times of the year worked for this purpose, so your ability to make a deductible contribution will be based on both of you having retirement plans in 2016.

    You can receive a full deduction if your MAGI is no more than $98,000.

    https://www.irs.gov/retirement-plans/plan-participant-employee/2016-ira-contribution-and-deduction-l...

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