TT says husband made excess contribution to traditional IRA and will owe 6% penalty every year until withdrawn - How is this possible?

[DiscoKen75]

Husband and I are both mid-50s.  Filing jointly. We both contributed $7k to our individual Traditional IRAs in 2021 for tax year 2021. No Ross contributions.  I have a work 401k plan, husband does not. After completing the IRA section, TT states 'husband has made an excess contribution of $7k and will owe 6% penalty each year money remains in IRA'.

Why is husband showing an excess contribution when he has no other retirement plans? Due to his age, he is qualified to contribute up to $7k each year.

Our adjusted gross income is > $100k. 

[HelenC12]

Make sure your husband's W-2 doesn't have a X in Box 13, Retirement Plan. If there is in X, he may not be eligible to contribute to an IRA since he is deemed to have participated in a plan even if he didn't contribute to the plan. 

Review your entries. On the Retirement Plan at Work screen, Is XXX covered by a retirement plan at work, verify that you answered No.

[DiscoKen75]

Hi - Box 13 is NOT checked on his W2.

And confirmed that 'is XXX covered by a retirement plan at work' is checked "NO".

I even deleted all data in the IRA section and started from scratch and continue to get the 'excess contribution' warning.

[ThomasM125]

If your adjusted gross income is over $208,000, you can't take a deduction for an IRA contribution, since you have a retirement plan at work per this from the IRS:

Here is a link to the article:

IRA deductions if spouse has retirement plan

[dazed---confused]

I am experiencing the same problem. Did you ever figure it out? Thanks.