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Posted by cptkirkh on February 26, 2007, 12:35 am
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I have a 401K through my company and my wife doesn't. If I
start one for her will we be able to deduct those
contributions?
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Posted by PeterL on February 27, 2007, 3:17 pm
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> I have a 401K through my company and my wife doesn't.
> If I start one for her will we be able to deduct those
> contributions?
You can't start a 401K for your wife, unless you own a
company and hires her. Only her employer can offer her a
401K plan.
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<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
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<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
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<< Copyright (2006) - All rights reserved. >>
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Posted by Phil Marti on February 27, 2007, 3:17 pm
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> I have a 401K through my company and my wife doesn't. If I
> start one for her will we be able to deduct those
> contributions?
You can't start a 401(k) for her. Only employers can
establish those plans.
She can make a $4,000 traditional IRA contribution which
will be deductible if your joint AGI is under $150,000. See
IRS Publication 590.
--
Phil Marti
Clarksburg, MD
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
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Posted by Bill on February 27, 2007, 3:36 pm
Please log in for more thread options khill@scic.com (cptkirkh) posted:
> I have a 401K through my company and my
> wife doesn't. If I start one for her will we be
> able to deduct those contributions?
A 401K is an instrument which must be offered by the company
itself. If her company offers this option and she meets the
requirements to join the plan (sometime related to duration
of employment), she could join.
Otherwise, you could make contributions to a traditional IRA
-- and still may for the tax year 2006, up until April17
(the final date for filing this year). That would require
selecting a trustee, or custodian, for her IRA and filling
out the necessary documents, plus depositing the amount
contributed for 2006.
IRA deductibility is tied to total income, and since your
company offers a 401K, which is deemed a retirement plan,
the limits on income are lowered. See Pub 590 (Individual
Retirement Arrangements) for full info, or check either Pub
17 or 1040 Instructions for more limited information.
Bill
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
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Posted by kastnna on February 27, 2007, 3:36 pm
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> I have a 401K through my company and my wife doesn't. If I
> start one for her will we be able to deduct those
> contributions?
You can't "start one for her" at all. 401(k) is employer
sponsored. She can establish an IRA. Depending on your
income you may be able to deduct those contribs. I believe
the phase out is $156K-$166K adjusted gross income.
If your wife is self-employed there are other options such
as SEP and SIMPLE IRAs or solo 401(k)s that allow larger
contributions.
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
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