topic 401K and IRA contributions in Deductions & credits

401K and IRA contributions

LDFJunnila — Mon, 09 Mar 2026 04:37:37 GMT

Last year, I contributed to a 401K til March, 2021. I stopped contributing to it because I left my job, and instead started to contribute to an IRA, since I couldn't join my new company's 401k. When doing my taxes, it said my IRA contributions were not deductible because I had a 401k. But I wasn't in a 401k all year--just the first quarter of 2021. Is it correct that my IRA contributions for the rest of the year are not deductible, even though I was unable to save anything in a 401k?

Re: 401K and IRA contributions

MinhT1 — Mon, 28 Feb 2022 21:26:29 GMT

Even if you only contributed to your 401(k) plan for only part of the year, you are considered as covered by a retirement plan at work for tax year.

As a covered person, your eligibility for a deductible IRA may be limited by your Modified Adjusted Gross Income (MAGI).

Please read this IRS document to determine your eligibilty for a deductible IRA.

Re: 401K and IRA contributions

LDFJunnila — Tue, 01 Mar 2022 16:00:19 GMT

So, one more question. I changed jobs in March. I did not have access to contribute to a 401k from April through December in my new job.

How can I be considered covered when I didn't have a 401K to contribute to from April through Dec?

Re: 401K and IRA contributions

Opus 17 — Tue, 01 Mar 2022 16:32:59 GMT

@LDFJunnila wrote:

So, one more question. I changed jobs in March. I did not have access to contribute to a 401k from April through December in my new job.

How can I be considered covered when I didn't have a 401K to contribute to from April through Dec?

You were "covered" for all of 2021 under the meaning of the law, if you made even one contribution. If you think the law is unfair, you need to talk to your Congressional representatives.