Author Topic: MAGI and tIRA deduction limits  (Read 1198 times)

doneby35

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MAGI and tIRA deduction limits
« on: October 26, 2016, 02:27:31 PM »
I tried to look this up I promise :) but I thought you guys can help me with the right answer to the question.

If i'm married with a yearly salary of 106,000 and I am the only wage earner in the household, will I be eligible for a full tIRA deduction? The IRS website says if married filing jointly and MAGI is 98,000 or less, you get the full deduction, but I'm not quite sure how to get the MAGI number.

I also just signed up for 401k and HSA with my employer a couple of days ago and planning to max both out, so i'm not sure if that comes into play when it comes to calculating MAGI.
Is it then 106,000 - 18,000 (401k) - 6750 (HSA) = 81,250 <-- MAGI ???

boarder42

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Re: MAGI and tIRA deduction limits
« Reply #1 on: October 26, 2016, 02:37:04 PM »
yes that is a correct MAGI calculation.  i dont know how the married filing jointly vs head of household works though with one wage earner.

terran

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Re: MAGI and tIRA deduction limits
« Reply #2 on: October 26, 2016, 02:38:07 PM »
Here you go: https://turbotax.intuit.com/tax-tools/tax-tips/IRS-Tax-Return/What-Is-the-Difference-Between-AGI-and-MAGI-on-Your-Taxes-/INF22699.html

If you're able to get the full $18k into your 401k this year, then yes, your calculations would be right, although you may also be able to reduce it by things like the amount your pay towards health insurance. You can contribute to the HSA up through the tax filing deadline (though not through payroll so you'll miss out on any FICA savings in that case).

doneby35

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Re: MAGI and tIRA deduction limits
« Reply #3 on: October 26, 2016, 02:58:05 PM »
hmm so I have to wait until next year since my 401k balance is currently $0. Thank you.