topic IRA Contributions in Retirement tax questions

IRA Contributions

mike19 — Wed, 08 Jul 2020 17:43:12 GMT

I would like to make a traditional IRA contribution but TT says my MAGI is too high. My taxable income is $92,131and I would like to contribute to my IRA. I have a business but I don't seem to have a SEP account anymore. I am over 55years old...

Re: IRA Contributions

GiseleD — Wed, 08 Jul 2020 18:28:41 GMT

The MAGI is not your taxable income. It is a separate number, and in many cases (not all), it is equal to your adjusted gross income.

Were you covered by a retirement plan at work? If so, there are modified AGI (MAGI) phaseouts based on filing status. They are below:

MFJ, QW: $103,000 to $ 123,000

Single, HOH: $64,000 to $ 74,000

MFS: $0 to $ 10,000

Spouse not covered by employer: $193,000 to $ 203,000

Re: IRA Contributions

dmertz — Wed, 08 Jul 2020 20:53:18 GMT

With sufficient compensation and being under 70½, you are eligible to contribute to a regular traditional IRA but your MAGI might limit your eligibility to deduct the contribution, depending on whether or not you are covered by a workplace retirement plan.

With regard to your businesses SEP, plan, if your business established a SEP plan and never terminated the plan, your business still has a SEP plan (although it might be necessary to update the plan agreement if it hasn't been updated since 2004).