Question : i did not contribute to company retirement plan or 401k. Can I contribute to IRA?
I joined new employer in Sep,2005. I was eligible to join 401K from Nov2005. I did not contribute to 401k plan. Box 13 in my W2 (retirement plan) is checked.I am trying to claim my $4,000 IRA contribution. Turbo tax is not giving full deduction of $4,000. It is giving only $770 deduction from my Total Income. Why do not I get $4000 IRA deduction.Thanks inadvance.Ram
- asked by rav_sa
All Answers:
Answer #1
Yes, you can contribute to IRA upto $4000.00($4500.00 for over 50). However, If youcontributed to company retirement plan, your IRAcontribution benefit starts to phase out dependingupon the proportion of contribution to companyretirement plan. When box 13 is checked, althoughyou may not have made contribution, however, youremployer sets aside a portion for your retirement.You are only benifited when you retire throughsame employer.
- answered by desi_dreamz
Answer #2
Income limits apply when box 13 is checked.
- answered by IAGT
Answer #3
The reason it is giving you a lower amount isbecause you made too much money. If your employerhas a 401k available and you make over a certainamount than you are subject to a phase out. Go to
http://irs.gov and download publication 590. Itgives great examples and has the table that showsthe income levels and phase outs.
- answered by Steve
Answer #4
You might have made to much money. Did you alsofill out an 8880? You look at the form 8606 itwill show you how much you can take. You shouldsee an amount on line 32, line 57(if you filledout the 8880) on the 1040. Also this is one of thecredits that will only lower your tax liability.It can bring you to a 0 tax.
- answered by jen
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