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Level 2
posted Apr 8, 2025 4:54:24 PM

I'm single. My MAGI is $1M+. TT says my $8k contribution to Traditional IRA is deductible. That cannot be true, can it?

I have had 7 Tax experts tell me that my situation is a system glitch.  

But that does not help me.

What do I do to get it fixed?

 

0 6 1112
6 Replies
Expert Alumni
Apr 8, 2025 5:00:12 PM

It is deductible if you aren't covered by a retirement plan at work.  IRA Contribution and Deduction Limits.

If you are covered by a retirement plan at work, be sure to indicate this in the IRA contribution section of TurboTax or by checking the box "retirement plan" under neat the area for Box 13.
 

Level 2
Apr 8, 2025 5:11:11 PM

OMG!

 

Are you serious?

And I could not get that answer sooner!

Well thank you from the bottom of my heart.  And check book.

That turns into a nice little $3k credit if I choose deductible.

Or is there an upside to leaving it non-deductible in this situation?

 

Expert Alumni
Apr 8, 2025 5:14:25 PM

It's up to you, pay the tax now or pay the tax later.

If you think your tax rate will go down, you'd most likely rather pay the tax on it later. 

Level 2
Apr 8, 2025 5:29:23 PM

Sorry - pay now or later?

 

 

Expert Alumni
Apr 8, 2025 5:51:14 PM

 No. There's no harm in leaving this as a non-deductible contribution. What KrisD15 meant was you can choose to treat this as a non-deductible contribution now with after-tax dollars than to deduct the contribution made with pre-taxed dollars and then pay tax on it later.

Level 2
Apr 8, 2025 5:57:47 PM

Thank you for your reply.

 

I don't know of any tax rate that will go down with time so I think I will make it non-deductible...