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Posted by nickravo1 on November 10, 2006, 2:02 am
Please log in for more thread options A.G. Kalman 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.)
> I'm stumped as to how you seem to be in a 403(b) plan that
> withholds 80 - 100% of your pay? Typically, an employee's
> contribution to a 403(b) is through payroll deduction at a
> percentage of your pay. That percentage is never near 80 to
> 100%. In addition, these contributions from your pay are
> typically before tax and reduce your taxable compensation.
> To the extent that you have any taxable compensation
> reported to you in Box 1 of your W-2, you could make a
> contribution to an IRA equal to that taxable amount or $5K,
> whichever is lower.
>
> As you actively participated in a retirement plan at work,
> your ability to deduct that contribution will depend upon
> your modified AGI. See IRS Pub 590 for more details.
> http://www.irs.gov/publications/index.html
Let's say I earn $5K a month as a college professor, and I
tell my payroll person in Decembre that the next caledner
year I am likely leaving my job early and request that they
deduct all they can from my salary each pay period, until my
annual limit is hit (in like April), instead of taking the
payroll deductions over 12 months. That way, if I leave the
job early, I can get the full $20K into my 403b instead of
just 25 percent or so of it, Comprende?
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