2018's pay affecting 2019's 401(k) assumption

[bellis777]

My wife stopped working at her job on 12/31/2018 where she had a 401(k). Unfortunately, her last paycheck was provided in January 2019 with a whopping $73 put into her 401(k). Now, she stopped working in 2018, so really doesn't have a qualified 401(k) for 2019, but TurboTax is assuming she does based on that last check. As a result, our combined "married couple" income won't allow for an IRA contribution deduction, of which I made $6000. Is there a way around this so I can indicate she didn't have a 401(k) in 2019? 

Many thanks.

[dmertz]

"Now, she stopped working in 2018, so really doesn't have a qualified 401(k) for 2019"

That's not necessarily true.  If the 401(k) plan uses a fiscal year instead of a calendar year, she is covered for 2019 because the plan year for which the contribution by elective deferral from her 2018 pay was made has an end date in 2019.

The marking of box 13 Retirement plan on her 2019 Form W-2 indicates whether or not she is considered covered for 2019.  If you think the employer marked this box incorrectly, it will be necessary to take that up with the employer.

[AnnetteB6]

Unfortunately, if her W-2 indicates 'covered by a retirement plan', there is not a way around it.  

Based on that check-box, she is considered to be covered by a retirement plan for the whole year.