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Posted by Mark Bole on November 4, 2006, 10:35 pm
Please log in for more thread options Mark Bole wrote:
> garagecapital@gmail.com wrote:
>> If I work for my company for the month of Janary and then
>> quit working for the year (and earn about $5K that month and
>> $4K-$5K of it goes into a 403b plan), can I also put $5K
>> into an IRA? (I am over 50.)
> If you were covered for even one day under an employer retirement plan,
> it counts for the entire year. The amount you contributed to the 403b
> plan in irrelevant.
>
> You can always make a traditional IRA contribution up to the allowed
> amount. Given that you were an active participant in an employer plan,
> your ability to DEDUCT that contribution may be limited, depending on
> your modified adjusted gross income. There are worksheets available
> with most software packages, as well as Table 17-1 of IRS Publication 17.
>
> If you are married and your spouse was not an active participant, there
> may be increased deductiblity if the contribution is made by the spouse.
To elaborate on "allowed amount", I forgot to mention the
compensation test. If you had no additional compensation
for the year, nor did your spouse (if any), then no, you are
not allowed a contribution beyond your compensation amount.
-Mark Bole
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