The Money Mustache Community
Learning, Sharing, and Teaching => Investor Alley => Topic started by: vagabond on February 21, 2014, 11:17:29 AM
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please help me understand - for married filing jointly if my MAGI is > 115000 k and both myself and DW have contributed some amount to respective 401k's @ work ( though didnt max those ) , can we not deduct the traditional IRA contributions for 5.5k each.
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http://www.irs.gov/pub/irs-pdf/p590.pdf
In particular go to page 12 where they outline deductions and how they are affected by employer sponsored plans (more information on page 14).
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MFJ MAGI > 115k = no deduction
http://www.irs.gov/Retirement-Plans/2013-IRA-Deduction-Limits-Effect-of-Modified-AGI-on-Deduction-if-You-Are-Covered-by-a-Retirement-Plan-at-Work
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A much better answer than mine. :)
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thanks all for your replies. With no deductions , that gives zero incentive to contribute to traditional IRA.
Also lesson learnt the hard way for this year - will need to be more tax efficient for next year.
Was hoping if there was a way to somehow make up for the missed opportunity to contribute the difference of 17.5k- partial contribution made for last :-)
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put it in a Roth IRA. you can still get that tax benefit. AND if your MAGI is over 115k you should be able to max out 401k's and Roth IRAs.