We're pleased to announce an update is coming to the community boards.
Sunday, September 25th: We are migrating the boards to a new platform. The site is currently in read-only mode and we will bring it back online as soon as the migration is complete.
This board has been migrated to our new platform! Click below to continue the discussion on the new site.
Let's say that the wife and I have a combined gross income of $165,000.00. Would the fact that we each contrbute $10,500.00 to our 401(k)'s bring our AGI down to $144,000.00 and permit us to each make $2,000.00 tax-free contributions or are we prevented from doing so because we're above the limit?Yes. You'll find the explanation of the qualifying Modified Adjusted Gross Income (MAGI)in IRS Publication 590.Note that your 401(k) contributions are deducted from your wages before your employer ever reports them in box 1 of your W-2. Thus, those contributions never make it on to your tax return and are thus not part of AGI. Nor are they an add-in for Roth MAGI, so you're safe.TMF ExROPhil Marti
Best Of |
Favorites & Replies |
Start a New Board |
My Fool |