traditional IRA deductibility
I understand that a (single) person, who is an employee, and is NOT an active participant in a defined contribution plan, or profit sharing plan, money purchase plan or stock bonus plan can make an annual deductible IRA contribution, regardless of income. Can I presume that SEP IRA (employer contribution only) and ESOP (employee stock option plan- ISO’s) are included in this list?
Permalink Submitted by Alan - IRA critic on Sun, 2016-08-28 00:27
This description of “active participants” lists the types of plans that could affect the IRA deduction. ISOs are non qualified plans and do not affect IRA deductions; neither does 457b plan participation. An ESOP however is a qualified plan and therefore WOULD affect IRA deductions. An employee W-2 “Retirement Plan” box 13 should be checked in sync with this definition.http://retirementdictionary.com/definitions/activeparticipant