Traditional IRA contribution not deductible - issue

Forum|Forum|5 years ago
February 23, 2021
1 reply
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I am trying to contribute to Traditional IRA for my wife as she does not have employer sponsored 401K, while i have employer sponsored 401k, IRS shows filing jointly with less than 196k combined income are eligible. Turbo tax shows MAGI is over132k and i am not eligible for Roth IRA deductions . Pls help if i am missing something

TurboTax Premier Online

Best answer by sganga

Can you please check your wife's W-2 entry that retirement plan in box 13 isn't checked by accident or there is any information in box 12 that indicates a retirement plan?

Also, your combined MAGI is 132k, correct?

Yes, Combined MAGI is 132K, Issue was fixed and selection in the IRA Tab is updating my W2 information. I have fixed the W2 section 13 and its now showing correctly

Thank you for the help.

DanaB27

Level 15

Please, ensure that the contribution to the traditional IRA is entered under your wife's name.

Login to your TurboTax Account
Click on the Search box on the top and type “IRA contributions”
Click on “Jump to IRA contributions"
Select “traditional IRA” for your wife

Please be aware that Roth IRA contributions are not deductible (but maybe you meant traditional IRA?).

You won't be able to deduct the contribution to a traditional IRA because you are covered by a retirement plan as work and your MAGI is over $124,000.

Your wife can deduct the full amount to a tradition IRA because only you were covered by a retirement plan and your MAGI was below $196,000.

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sgangaAuthor

Level 2

Thank you for the reply.

I have followed the same steps over and over again

Click on the Search box on the top and type “IRA contributions”
Click on “Jump to IRA contributions"
Select “traditional IRA” for your wife

Msg: Income Too High To Deduct an IRA Contribution
Wife's modified adjusted gross income ( MAGI) is $132,K which puts Wife over the limit for IRA deductions. To deduct a contribution, you can't have a MAGI of over $124,000 while being covered by a retirement plan at work. Learn More

My wife's W2 does not have employer sponsored 401, but turbo tax thinks she is covered by retirement plan

Is this a bug in the application software ? how can i overwrite this ?

DanaB27

Level 15

Can you please check your wife's W-2 entry that retirement plan in box 13 isn't checked by accident or there is any information in box 12 that indicates a retirement plan?

Also, your combined MAGI is 132k, correct?

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