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At the beginning of 2014 -- my company did not offer a 401K so I contributed to an IRA account for the tax deduction. In November, they announced a 401K program & my first contribution went through in December. I did not have any options to roll my IRA into the 401K (I am not much of an investor, yet..so I don't think this is possible anyway but please let me know if I'm wrong).
The tax deduction states that you don't have access to a retirement plan. My W2 that I received today shows an X by retirement plan.
Does this mean I cannot take any of the contributions towards my IRA before the 401K was in place? Has anyone run into this before?
Actually, I just looked into this yesterday for myself. My takeaway from IRS pub 590.....if you are covered at any time during the year, you are considered to be covered for that year, which means your IRA deductibility is subject to those guidelines....whether none, all,or partial is deductible will be based on your income and filing status.
If you end up having non deductible contributions, you will need to file the appropriate IRS form to declare them so you don't pay tax on that money again. It was at one time best to just open up a non-deductible IRA account and keep that money separate. Things may be different now.
At the beginning of 2014 -- my company did not offer a 401K so I contributed to an IRA account for the tax deduction. In November, they announced a 401K program & my first contribution went through in December. I did not have any options to roll my IRA into the 401K (I am not much of an investor, yet..so I don't think this is possible anyway but please let me know if I'm wrong).
The tax deduction states that you don't have access to a retirement plan. My W2 that I received today shows an X by retirement plan.
Does this mean I cannot take any of the contributions towards my IRA before the 401K was in place? Has anyone run into this before?
Answer to whether ira contribution can be taken as deduction depends on your filing status and adjusted gross income. Too little info here.
To answer first question, the 401k plan would have to allow rollovers into the plan. Ask your employer.
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