A:

No. An individual's participation in an employer-sponsored plan (including a 401(k) plan) does not affect his or her ability to make a contribution to a Traditional IRA. The participation in an employer-sponsored plan may, however, affect the individual's ability to deduct the Traditional IRA contribution. For an individual who is an active participant, the ability to deduct a Traditional IRA contribution is determined by his or her tax-filing status (i.e., married filing jointly, separately, or filing single) and adjusted gross income.



(For information about an individual's ability to deduct a Traditional IRA contribution, see Traditional IRA Deductibility Limits.)



This question was answered by Denise Appleby
(
Contact Denise)



RELATED FAQS
  1. Am I allowed to adjust my AGI for IRA contributions made in 2015?

    I have made above the $100K and am a single tax payer, my employer does offer a 401k plan. I am a little unclear on ... Read Answer >>
  2. If I participate in my company's SIMPLE IRA plan, can I also contribute to another ...

    Because the SIMPLE IRA contribution limits are much lower than the 401(k) limits, it might at first seem unfair that you ... Read Answer >>
  3. I make over $100,000/yr and my adjusted gross income precludes standard IRA contributions. ...

    With an adjusted gross income (AGI) of more than $100,000, only your eligibility to deduct contributions to a Traditional ... Read Answer >>
  4. I earn more than the income limit for both a Roth and Traditional IRA deduction. ...

    It is always a good choice to fund the individual retirement account (IRA), even if the owner is not eligible to claim the ... Read Answer >>
  5. What are the main differences between a Simplified Employee Pension (SEP) IRA and ...

    Discover the difference between a simplified employee pension IRA and a traditional IRA so that you can choose the best retirement ... Read Answer >>
  6. Can I deduct my Individual Retirement Account (IRA) contribution on my tax return?

    Whether you can deduct IRA contributions on your tax return depends on the type of IRA you have, your participation in an ... Read Answer >>
Related Articles
  1. Retirement

    Traditional IRAs: Contributions

    By Denise ApplebyFunding an IRA A Traditional IRA can be funded by several sources and means: Regular IRA contributions Spousal IRA contributions Transfers Rollover contributions Regular IRA ...
  2. Retirement

    Traditional IRA Deductibility Limits

    Find out whether you can take a tax deduction on the contributions you make.
  3. Retirement

    Traditional IRAs Tutorial

    This comprehensive guide goes through what a Traditional IRA is and how to set one up, contribute to it and withdraw from it.
  4. Retirement

    Making Spousal IRA Contributions

    Eligibility requirements, contribution limits and tax deductions all change with one little ring.
  5. Retirement

    IRA Contributions: Deductions and Tax Credits

    We outline the incentives and help you take full advantage of the benefits.
  6. Retirement

    Traditional IRAs: Introduction

    By Denise ApplebyThere is no question that the world of retirement and retirement plans is a confusing one. With so many options to choose from, how does an individual know which one is best ...
  7. Retirement

    IRA Contribution Limits in 2016

    Find out about the 2016 limits for contributions and income thresholds for individual retirement accounts, including traditional IRAs and Roth IRAs.
  8. Retirement

    Roth vs. Traditional IRA: Which Is Right For You?

    To answer this question, you need to consider several of the factors we outline here.
  9. Retirement

    Traditional IRAs: Conclusion

    By Denise Appleby Let's recap: Any individual who has eligible compensation during the year and will not reach age 70.5 by the end of the year may make an IRA contribution for the year. Traditional ...
  10. Retirement

    Analyzing The Best Retirement Plans And Investment Options: Individual Retirement Accounts (IRAs)

    What they are: An individual savings account with tax incentives. Pros: Tax benefits - investments grow tax-deferred and contributions may be deductible; variety of investment options ...
RELATED TERMS
  1. IRS Publication 590: Individual Retirement Arrangements (IRAs)

    A document published by the Internal Revenue Service (IRS) that ...
  2. IRA Plan

    A plan that individuals may establish to arrange and plan for ...
  3. Roth IRA Conversion

    A reportable movement of assets from a Traditional, SEP or SIMPLE ...
  4. Savings Incentive Match Plan For Employees Of Small Employers - SIMPLE

    A retirement plan that may be established by employers, including ...
  5. Saver's Tax Credit

    A non-refundable tax credit available to lower income individuals ...
  6. Payroll Deduction Plan

    A contribution plan in which an employer deducts a specified ...
Hot Definitions
  1. AAA

    The highest possible rating assigned to the bonds of an issuer by credit rating agencies. An issuer that is rated AAA has ...
  2. GBP

    The abbreviation for the British pound sterling, the official currency of the United Kingdom, the British Overseas Territories ...
  3. Diversification

    A risk management technique that mixes a wide variety of investments within a portfolio. The rationale behind this technique ...
  4. European Union - EU

    A group of European countries that participates in the world economy as one economic unit and operates under one official ...
  5. Sell-Off

    The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the ...
  6. Brazil, Russia, India And China - BRIC

    An acronym for the economies of Brazil, Russia, India and China combined. It has been speculated that by 2050 these four ...
Trading Center