Can I make a deductible IRA contribution?

A traditional IRA allows you to save for retirement in a tax-deferred account. However, eligibility rules can be complicated, and whether contributions will be deductible or not will depend on several factors, including:

Earned income: In order to make contributions to a traditional IRA, you must have earned income from employment or self-employment.

Coverage under an employer plan: You or their spouse is covered by an employer-sponsored retirement plan, such as a 401(k), their ability to make deductible IRA contributions may be limited.

Other (Roth) IRA contributions: If you have already made contributions to a Roth IRA, it could impact your ability to make deductible contributions to a traditional IRA.

Filing status-based MAGI thresholds: Your Modified Adjusted Gross Income (MAGI) will determine their eligibility to make deductible contributions to a traditional IRA. There are different MAGI thresholds depending on their filing status.

It's important to note that there may be other factors or considerations that impact a your ability to make deductible contributions to a traditional IRA. You should consult with a financial advisor or tax professional to ensure they understand the specific rules and implications of making IRA contributions in their individual situation.

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Robert J. Pyle, CFP®, CFA, AEP® founded Diversified Asset Management, Inc., in 1996 to provide personalized, comprehensive wealth management services to successful individuals, families, single women, and business owners. His specialty is addressing the complex financial needs of self-employed professionals, corporate executives, and small-business owners. Our disclosure can be found here. The views, opinion, information, and content provided here are solely those of the respective authors, and may not represent the views or opinions of Diversified Asset Management, Inc. Diversified Asset Management, Inc. cannot guarantee the accuracy or currency of any such third party information or content, and does not undertake to verify or update such information or content. Any such information or other content should not be construed as investment, legal, accounting, or tax advice.