The Money Mustache Community
Learning, Sharing, and Teaching => Taxes => Topic started by: Zacharias on October 06, 2015, 02:52:33 PM
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Hello Mustachians,
I work for a tiny business with 6 employees that are basically friends and family of the owner. There is no 401k, SEP IRA, or SIMPLE IRA in place (though I'm not sure how the owner funds his own retirement plan). Instead the owner makes a contribution directly to each employee's IRA.
What I don't quite understand is how this would be reported on tax returns or impact taxable income?
Thanks in advance for any help!
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It probably just gets reported as regular W-2 income. It would then be up to you to take the deduction on your taxes. IRA deductions are "above the line" so you wouldn't need to itemize to do so. If you made your contribution to a ROTH IRA, you probably wouldn't need to do anything.