IRA deduction | Ed Slott and Company, LLC

IRA deduction

ELIGIBILITY RULES FOR ROTH IRA CONTRIBUTIONS AND DEDUCTIBLE TRADITIONAL IRA CONTRIBUTIONS: TODAY’S SLOTT REPORT MAILBAG

Question: If your employer contributes to either a SEP IRA or a SIMPLE IRA, can you (the employee) also contribute to a Roth IRA? Regards, Alfred

Strategies When Your IRA Contribution Cannot Be Deducted

The other day an advisor called us with an issue that comes up frequently, especially in these tumultuous times. His client had made an IRA contribution for 2021 and was planning on deducting that contribution. However, his job situation changed, and he became an active participant in a retirement plan at a new job.

Active Participation and IRA Deductibility

This question (or a derivation of it) has been popular as of late: “I only participated in my 401(k) for a couple of months in 2020 before I was laid off. Does that still make me a ‘covered’ employee, and can I contribute to my Traditional IRA?” It seems innocent enough, but there is a heck of lot going on in this little question.

Falling Within the Phaseout, Part 2 - Determining Your Reduced IRA Deduction for 2020

In my blog entry from March 22, I discussed the formula for calculating the amount of a direct Roth IRA contribution when your income falls within the Roth phaseout limits. Another common phaseout covers how much of a Traditional IRA contribution can be deducted. As with the Roth contribution phaseout, this income level cutoff is not a “cliff,” meaning if you go one dollar over the level, you do not immediately become ineligible to deduct your Traditional IRA contribution. There is a phaseout range which gradually decreases the amount of the allowed deduction.

IRA Rollovers and Deductions: Today's Slott Report Mailbag

Question: Hello, If an individual has a solo 401(k), is this considered a "retirement plan at work" that would limit the deductibility of IRA contributions? Thanks! Susan Answer: Hi Susan, Being an active participant in a retirement plan for the year can limit your ability to deduct your traditional IRA contribution, depending on your income. Participating in a solo 401(k) would count as active participation for this purpose.

Marriage and Your Retirement Account

Marriage changes a lot of things. Some things are not quite as obvious as others. We walk you through the key changes to your IRAs, Roth IRAs and overall retirement planning.

6 Steps to Deduct an IRA Loss

Can you deduct a loss in your IRA or Roth IRA? The answer is yes, if you meet the criteria. It is much easier to deduct a loss in a Roth IRA than in a traditional IRA because Roth IRAs generally hold more basis than a traditional IRA. Basis in a traditional IRA comes only from nondeductible contributions and/or rollovers of after-tax funds previously held in an employer plan. Basis in a Roth IRA comes from Roth IRA contributions, Roth IRA conversions and most rollovers from designated Roth accounts (i.e. Roth 401(k) funds). Here are the six steps.

10 IRA Contribution Rules You Must Know

Tax season is here. This is the time when many IRA owners consider making contributions for the prior year. Are you planning on making a 2015 contribution to your IRA? Here are 10 IRA contribution rules you need to know.

10 (Not So) Simple Steps to Claiming a Deduction for a Roth IRA Loss

I was appearing as a guest on a radio show yesterday when a listener called in, saying that his Roth IRA had lost substantial value. Ultimately, the caller wanted to know if he could claim a deduction for his Roth IRA loss. I told him that the answer was probably “no,” but that a question like that would be exceedingly difficult to answer for sure, given the time I had left on air. Here is a more detailed answer to his question.

IRS Releases 2014 Retirement Plan Limits

Many of the retirement plan annual limits are indexed for inflation. IRS has just released the plan limits for 2014. We look at those limits in some detail below.

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