How Do I Know If My IRA Contributions Are Tax Deductible?

Contributions to a traditional IRA are fully deductible if you\ndon\'t already participate in an employer-sponsored retirement plan. For 2019, the maximum you can contribute to an IRA is $6,000. If you are age 50 or over, you can make an additional "catch-up contribution of $1,000.

If you do participate in an employer-sponsored plan, your contributions still can be fully or partially deductible, subject to certain income-level phaseouts. For 2019, the deduction phases out for single filers at modified adjusted gross income (AGI) between $64,000 and $74,000. For those who are married filing jointly, the deduction phases out at modified AGI between $103,000 and $123,000. For those filing jointly who do not participate in an employer-sponsored plan but whose spouse does, the deduction phases out at modified AGI between $193,000 and $203,000.

If you are ineligible to make deductible contributions to a\ntraditional IRA, you may want to investigate a Roth IRA. Contributions to a Roth IRA are made with after-tax dollars and are not tax deductible, but qualified distributions are tax free. Be aware that there are income-level phaseouts that limit contributions to a Roth IRA. For 2019, the contribution phaseout for single filers is between modified AGI of $122,000 and $137,000, and for married persons filing jointly, the phaseout is between modified AGI of $193,000 and $203,000.