IRA deductions

Forum|Forum|4 years ago
March 9, 2022
1 reply
6 views

I was covered thru employer 401k from April to July of last Year and after that rolled over the money to my IRA.at the same time have made $6000.00 to the Traditional IRA for deduction. spouse also was enrolled in 401k plan for 3 months in 2021.but when I claim the IRA deduction for $6000.00 it is giving the message that as the Modified Adjusted Gross income is greater than 125000 I cannot claim the $6000.00 deductible for IRA contributions. Please advise.

DanaB27

Level 15

Yes, the deduction may be limited if you or your spouse is covered by a retirement plan at work and your income exceeds certain levels. Please see IRA deduction limits for details.

You still can make the contribution but will have to keep track of your basis (nondeductible contribution) on Form 8606.

**Say "Thanks" by clicking the thumb icon in a post. **Mark the post that answers your question by clicking on "Mark as Best Answer"

TaxUser 2022Author

Level 2

When I complete the forms on Turbtax it does not have a section to complete Form 8606? I was just wondering if each one of us were in the 401k plan for 3 months and I contributed to the IRA and my income is less than the 125k MAGI limit will the deduction still not apply?

MarilynG

Level 15

Yes, your traditional IRA contributions are deductible. Click this link for more detail on IRA Contributions.

If you contributed to a 401K through your employer, this shows on your W-2 (Code D in Box 12) and TurboTax picks up this info automatically, so you don't need to enter it anywhere else .

Form 8606 tracks your 'non-deductible' contributions, so you don't need one for your situation, if you contributed to a Traditional IRA.

This link has detailed info on Form 8606.

**Say "Thanks" by clicking the thumb icon in a post. **Mark the post that answers your question by clicking on "Mark as Best Answer"