I am 66, on a fixed income and received a lump sum disability payment from a private insurance company. I now owe $5K in taxes. Is there a way to reduce this amount?

[SharonD007]

It depends. If you have earned income, you may be able to contribute to an IRA. You can contribute $7,000 or up to your earned income and get a deduction for it. If you have a retirement plan at work your deduction may be limited.

Please review the IRS links for additional information: Traditional and Roth IRAs, Are my contributions deductible? And 2023 IRA Deduction Limits - Effect of Modified AGI on Deduction and if You Are NOT Covered by a Reti....

There are other ways to reduce your taxable income depending on your personal situation. Please review TurboTax articles, 4 Last-Minute Ways to Reduce Your Taxes and 7 Best Tips to Lower Your Tax Bill from TurboTax Tax Experts for additional information.

[maravon]

I am retired and on living on SSI. So can I make an IRA contribution now (2023)  that would lower my tax due for last year (2022)?

[VolvoGirl]

Not unless you have income from working with a W2 or self employment income on a 1099NEC .