In Massachusetts we have a public pension system (Defined Benefit) that takes the place of Social Security for many public employees (this happens for other states as well). Both the ER and EE contribute, but I have never considered this to be a “covered plan” for which the EE was an “active participant”, for the purposes of IRA deductibility. My reasoning was that this public pension system is a replacement for Social Security– participants don’t contribute to SS but instead to the public pension system. And, since you can be covered by SS and still deduct your IRA contribution, this seemed to be analogous and therefore not a covered plan. First question: is this a mistake?

Secondly, some employees for the public are temporary and do not participate in the pension, but also do not participate in SS. They are shunted into a third vehicle, made possible by OBRA ’90, that takes a mandatory 7.5% of their income and places it into a 457 OBRA plan. Does this count as a covered plan for the purposes of IRA deductibility?
Thanks