Terminated 401k and IRA contributions
My employer terminated my 401k at the end of May. Can I make a $5,000 contribution to my Traditional IRA? My age is 43.
My employer terminated my 401k at the end of May. Can I make a $5,000 contribution to my Traditional IRA? My age is 43.
Permalink Submitted by Alan Spross on Wed, 2012-09-05 19:25
If contributions were made to your 401k account at any time in 2012, you are considered covered by a plan at work. If your income exceeds a certain amount you cannot deduct your TIRA contribution, but you could always make a non deductible contribution to the TIRA. If you qualify for a Roth IRA contribution, that is a better choice if you cannot deduct your TIRA contribution.
The income limit to deduct your TIRA contribution applies to modified AGI. Your deduction begins to phase out at 58k if single or 92k if married filing jointly.