topic message to open IRA and save $500 when MAGI is over limit is this an error? in Deductions & credits

message to open IRA and save $500 when MAGI is over limit is this an error?

ihatefascists — Mon, 09 Mar 2026 08:49:17 GMT

Filing jointly we are getting a message from Turbo Tax for me to open an IRA and save $500. I have a 401K plan from my employer and my MAGI is over the limit. So is this an error? My wife does not have an employer sponsored plan so she opened deductible IRA and got the full tax deduction. When i tell turbotax i opened IRA I get 500 tax savings but my IRA is not deductible. This makes no sense. Why nondeductible IRA gives tax savings?

Re: message to open IRA and save $500 when MAGI is over limit is this an error?

DanaB27 — Tue, 08 Mar 2022 13:42:55 GMT

Yes, your deduction might be limited if you are having a retirement account at work please see IRA deduction limits.

Can you please check line 20 on Schedule 1 if the deduction shows correctly? It should only show your wife's full deduction (if your MAGI is less than 198,000).

Where are you seeing the tax savings?

To preview Form 1040:

Click on "Tax Tools" in the left menu
Click "Tools"
Click "View Tax Summary" in the Tool Center window
Click on "Preview my 1040" on the left

Re: message to open IRA and save $500 when MAGI is over limit is this an error?

ihatefascists — Tue, 08 Mar 2022 20:33:24 GMT

it shows full deduction for my wife. i am covered by retirement plan at work, what is my MAGI to open deductible IRA for myself?

Re: message to open IRA and save $500 when MAGI is over limit is this an error?

FangxiaL — Tue, 08 Mar 2022 23:08:28 GMT

Use this table as a reference to figure out if your Traditional IRA contribution is deductible:

IRS Publication 590-A.

@ihatefascists