IRA contribution
Client turned 70 on August 18, 2010. Contributed 6,000 to 2010 IRA. Wants to know if he can contribute in January 2011for 2011 tax year even though he will be eligible for his first RMD 2/18/2011 but could potentially defer until 4/1/2012? Can he make a tax deductible contribution if he has earned income in 2011?
Permalink Submitted by Jose Morales on Thu, 2010-09-16 16:31
To be eligible to make a Traditional IRA contribution an individual must have earned income and NOT have attained the age of 70 1/2. Since he will attain the age of 70 1/2 in 2011, he is ineligible to make any contribution for tax year 2011.
Permalink Submitted by Alan Spross on Thu, 2010-09-16 18:07
He wouldn’t get a deduction, but he could contribute to a Roth IRA for 2011 and beyond if he has earned income and modified AGI is not over the limit.
Or if he is married, his 2011 income can be used for a spousal TIRA contribution for his spouse if she does not reach 70.5 in 2011. That contribution might qualify for the deduction.