Section 457 plan and traditional IRA
Can a person who participates in a Section 457 plan (W-2 retirement box is not marked and only plan participates in) also contribute to a traditional IRA and not be subject to the AGI phaseout?
Can a person who participates in a Section 457 plan (W-2 retirement box is not marked and only plan participates in) also contribute to a traditional IRA and not be subject to the AGI phaseout?
Permalink Submitted by Alan - IRA critic on Thu, 2016-12-22 16:52
Yes. The box should not be checked because the 457 is not a qualified plan. Therefore 457 contributions do not result in the income limits for an IRA deduction for this participant, but a spouse that participates in a qualified plan triggers an income limit for both spouses. And many other 457 participants also participate in a DB plan which would be a qualified plan resulting in the retirement plan box being checked.