Self Employed traditional IRA problem

[Mango NC]

I'm entering my traditional IRA retirement contributions for myself and my wife (Married filing jointly). We are each allowed to contribute up to $8,000 each as both of us are above 50 years old. Yet when I enter the $8000 amount for each of us TurboTax says my wife has an excess contribution and must withdraw the excess or face a penalty. What gives? This does not make sense. We have enough income to qualify.

[ThomasM125]

Your maximum contribution can be limited if you have a retirement plan at work, per this excerpt from an IRS article:

Also, you have to have earned income to qualify, pension or investment income does not count.

[Mango NC]

Thanks of the reply. However this does not solve the problem. 1-I'm self employed, there is no work retirement plan. 2- modified AGI will be less than $123,000.00. We are entitled to contribute $8,000 each, but the program isn't allowing it. It says we have to withdraw the excess or face a penalty. What excess???

[KeshaH]

If you'd like, we can look at your return and see exactly what you see to help come to a resolution. The return will be scrubbed and won't include any of your personal details.

If you're using TurboTax Online:

Once you're logged in to your account and have your amended return open,

- on the left hand panel, click on Tax Tools and then choose Tools

- on the pop up window, select Share my file with Agent

- you'll see a message saying you'll give us a copy of your tax return. Your personal information will be changed so we can't see any private information.

- click okay and you'll get another message with a token

If you're using TurboTax Desktop:

• Click on Online in the top menu of TurboTax Desktop for Windows
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Please reply to this message with your token so that we can further assist you. Let us know all other states that are included on the return.