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Subject:  401ks, SIMPLE's, and layoffs Date:  2/28/2007  7:01 PM
Author:  ksmith1123 Number:  56059 of 104807

This is kinda complex and I apologize up front for the length of this post. I was laid off on January 5th of 2006. My 401k contribution, along with company match for those 5 days of 2006 was a whopping $562. Up until that point, I had been contributing the maximum every year into my plan. My question is, can I still contribute up to the annual limit into my 401k for 2006 even though I am no longer employed at that company? I will not be eligible to contribute into my new employers 401k plan until the summer of 2007, so if I can't contribute into my old plan for 2006, I will miss out on the contribution and also on the tax savings that goes with it. And because of the job change, we relocated mid-year 2006 and my wife had not contributed up to her max into her SIMPLE IRA at her old job. Can she still contribute up to her max as well for 2006, even though she no longer works at her old employer?

And if we can't contribute to the 401k and/or SIMPLE any more for 2006, are we precluded from contributing to a standard IRA for 2006 (because we were each "officially" covered by a company retirement plan, even though mine was only for 5 days of 2006)???

Thanks for the help and insight, I have been away from The Fool for a few years and it is good to be back!
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