Insights

Can I still have a traditional IRA if I contribute to my 401(k) plan at work?

Written by Cross Border Wealth | Mar, 17, 2023 - 10:00 AM

Yes. Anyone with earned income can open and contribute to a traditional IRA. The contribution limit is $6,000 for 2022 (unchanged from 2021), plus an additional "catch-up" contribution of $1,000 if you're 50 or older. However, you may not be able to deduct your IRA contributions if you're covered by a 401(k) plan at work. Whether or not you can deduct your IRA contributions depends on your filing status and annual income (adjusted gross income, or AGI). Specifically, for tax year 2022:

  

Special rules apply if your spouse is covered by a plan at work, but you are not. You may also qualify for a partial tax credit for amounts contributed to your traditional IRA or your 401(k) plan.