How much can you contribute to an IRA?
It might seem more enticing to put money into an IRA rather than a retirement plan through your workplace, such as a 401(k) or 403(b) plan. You'll remember that with a Traditional (pre-tax) IRA, you can take a tax deduction up to the IRS limit for your contributions. BUT what is sometimes overlooked is if you're covered at work, different limits apply. Just being covered by a plan at work can affect your ability to take a deduction for contributions made to your pre-tax IRA!
Here is some important information based on 2018. For more information, please refer to the IRS's website.
If you're covered by a retirement plan at work, you'll need to determine if your modified AGI affects the amount of your deduction. The IRS has a chart that is updated each year.
If you file single or head of household and your modified AGI is $73,000 or more, you cannot take a deduction for your pre-tax IRA contributions!
If you're married and filing jointly and make more than $121,000, you cannot take a deduction for your pre-tax IRA contributions!
If you're planning on contributing to a Roth IRA, there are no additional limits to know about (except the IRS limit for the year).
This and other limits can be found here.
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