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Returning Member
posted Apr 24, 2024 9:43:34 AM

max 401K contribution

For 2023, I had employer sponsored 401K and i contributed the IRS max allowed investment of $22,500. I also have Rollover IRA account with ETrade where i have invested my previous 401K from my previous employers. In 2023, i contributed $6500 to Rollover IRA on top of $22,500 to employer sponsored 401K plan. Am i allowed to contribute this additional $6500 to Rollover IRA for 2023? I did not take any deductions when i filed my taxes for 2023. Please let me know if i can leave the additional $6500 contribution to IRA as-is or should i ask for refund of that money. Thank you. 

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1 Replies
Employee Tax Expert
Apr 24, 2024 11:35:07 AM

Yes, you ‌can contribute to both a 401(k) and an IRA in the same year, but your contribution deductions may be limited based on your modified AGI.

For 2023, if you are covered by a retirement plan at work, your deduction for contributions to a traditional IRA is reduced (phased out) if your modified AGI is:

  • More than $116,000 but less than $136,000 for a married couple filing a joint return or a qualifying surviving spouse,
  • More than $73,000 but less than $83,000 for a single individual or head of household, or
  • Less than $10,000 for a married individual filing a separate return.

See Publication 590-A (2023), Contributions to Individual Retirement Arrangements (IRAs)

 

Additionally, for 2023, the most that can be contributed to your traditional IRA is generally the smaller of the following amounts.