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1040ez Tax Table

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1040ez Tax Table

1040ez tax table 5. 1040ez tax table   Ministers and Church Employees Table of Contents Alternative Limit for Church Employees Changes to Includible Compensation for Most Recent Year of ServiceChanges to Includible Compensation Changes to Years of Service Self-employed ministers and church employees who participate in 403(b) plans generally follow the same rules as other 403(b) plan participants. 1040ez tax table This means that if you are a self-employed minister or a church employee, your MAC generally is the lesser of: Your limit on annual additions, or Your limit on elective deferrals. 1040ez tax table For most ministers and church employees, the limit on annual additions is figured without any changes. 1040ez tax table This means that if you are a minister or church employee, your limit on annual additions generally is the lesser of: $51,000 for 2013 and $52,000 for 2014, or Your includible compensation for your most recent year of service. 1040ez tax table Although, in general, the same limit applies, church employees can choose an alternative limit and there are changes in how church employees, foreign missionaries, and self-employed ministers figure includible compensation for the most recent year of service. 1040ez tax table This chapter will explain the alternative limit and the changes. 1040ez tax table Who is a church employee?   A church employee is anyone who is an employee of a church or a convention or association of churches, including an employee of a tax-exempt organization controlled by or associated with a church or a convention or association of churches. 1040ez tax table Alternative Limit for Church Employees If you are a church employee, you can choose to use $10,000 a year as your limit on annual additions, even if your annual additions computed under the general rule is less. 1040ez tax table Total contributions over your lifetime under this choice cannot be more than $40,000. 1040ez tax table Changes to Includible Compensation for Most Recent Year of Service There are two types of changes in determining includible compensation for the most recent year of service. 1040ez tax table They are: Changes in how the includible compensation of foreign missionaries and self-employed ministers is figured, and A change to the years that are counted when figuring the most recent year of service for church employees and self-employed ministers. 1040ez tax table Changes to Includible Compensation Includible compensation is figured differently for foreign missionaries and self-employed ministers. 1040ez tax table Foreign missionary. 1040ez tax table   If you are a foreign missionary, your includible compensation includes foreign earned income that may otherwise be excludable from your gross income under section 911. 1040ez tax table   If you are a foreign missionary, and your adjusted gross income is $17,000 or less, contributions to your 403(b) account will not be treated as exceeding the limit on annual additions if the contributions are not in excess of $3,000. 1040ez tax table   You are a foreign missionary if you are either a layperson or a duly ordained, commissioned, or licensed minister of a church and you meet both of the following requirements. 1040ez tax table You are an employee of a church or convention or association of churches. 1040ez tax table You are performing services for the church outside the United States. 1040ez tax table Self-employed minister. 1040ez tax table   If you are a self-employed minister, you are treated as an employee of a tax-exempt organization that is a qualified employer. 1040ez tax table Your includible compensation is your net earnings from your ministry minus the contributions made to the retirement plan on your behalf and the deductible portion of your self-employment tax. 1040ez tax table Changes to Years of Service Generally, only service with the employer who maintains your 403(b) account can be counted when figuring your limit on annual additions. 1040ez tax table Church employees. 1040ez tax table   If you are a church employee, treat all of your years of service as an employee of a church or a convention or association of churches as years of service with one employer. 1040ez tax table Self-employed minister. 1040ez tax table   If you are a self-employed minister, your years of service include full and part years during which you were self-employed. 1040ez tax table Prev  Up  Next   Home   More Online Publications
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The IRS is taking action to protect taxpayers from identity theft and helping victims of tax-related identity theft

Over the past several years, the IRS has taken numerous steps to combat identity theft and protect taxpayers. This is a top priority for the IRS. We have taken actions to be better prepared in both fraud prevention and victim assistance, and we are continuing our efforts in these areas.

On the prevention side, this means putting in place new processes for handling tax returns, new compliance filters to detect fraud, new initiatives to partner with stakeholders and a continued commitment to investigate the criminals who perpetrate these crimes.

For victim assistance, the IRS is working to speed up case resolution, provide more training for our employees who assist victims of identity theft, and step up outreach to and education of taxpayers so they can prevent and resolve tax-related identity theft issues quickly.

The IRS has designed various new identity theft screening filters that will improve our ability to spot false returns before they are processed. Once a tax return is flagged, we will correspond with the sender before further processing the tax return to make sure we have the right taxpayer. Under an expanded pilot initiative, a group of victims with previously confirmed cases of identity theft will go through a supplementary verification process, which will give us an additional tool to help prevent further identity theft and detect fraud.

The identity theft landscape is constantly changing, as identity thieves continue to create new ways of stealing personal information and using it for their gain. The IRS is firmly committed to working with taxpayers to take care of these problems as quickly as possible.

 

 


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Page Last Reviewed or Updated: 06-Dec-2013

The 1040ez Tax Table

1040ez tax table 1. 1040ez tax table   Traditional IRAs Table of Contents What's New for 2013 What's New for 2014 Introduction Who Can Open a Traditional IRA?What Is Compensation? When Can a Traditional IRA Be Opened? How Can a Traditional IRA Be Opened?Individual Retirement Account Individual Retirement Annuity Individual Retirement Bonds Simplified Employee Pension (SEP) Employer and Employee Association Trust Accounts Required Disclosures How Much Can Be Contributed?Limit. 1040ez tax table When repayment contributions can be made. 1040ez tax table No deduction. 1040ez tax table Reserve component. 1040ez tax table Figuring your IRA deduction. 1040ez tax table Reporting the repayment. 1040ez tax table Example. 1040ez tax table General Limit Kay Bailey Hutchison Spousal IRA Limit Filing Status Less Than Maximum Contributions More Than Maximum Contributions When Can Contributions Be Made? How Much Can You Deduct?Kay Bailey Hutchison Spousal IRA. 1040ez tax table Are You Covered by an Employer Plan? Limit if Covered by Employer Plan Reporting Deductible Contributions Nondeductible Contributions Examples — Worksheet for Reduced IRA Deduction for 2013 What if You Inherit an IRA?Treating it as your own. 1040ez tax table Can You Move Retirement Plan Assets?Transfers to Roth IRAs from other retirement plans. 1040ez tax table Trustee-to-Trustee Transfer Rollovers Transfers Incident To Divorce Converting From Any Traditional IRA Into a Roth IRA Recharacterizations When Can You Withdraw or Use Assets?Contributions Returned Before Due Date of Return When Must You Withdraw Assets? (Required Minimum Distributions)IRA Owners IRA Beneficiaries Which Table Do You Use To Determine Your Required Minimum Distribution? What Age(s) Do You Use With the Table(s)? Miscellaneous Rules for Required Minimum Distributions Are Distributions Taxable?January 2013 QCDs treated as made in 2012. 1040ez tax table 2013 Reporting. 1040ez tax table Additional reporting requirements if you made the election to treat a January 2013 QCD as made in 2012. 1040ez tax table One-time transfer. 1040ez tax table Testing period rules apply. 1040ez tax table More information. 1040ez tax table Distributions Fully or Partly Taxable Figuring the Nontaxable and Taxable Amounts Recognizing Losses on Traditional IRA Investments Other Special IRA Distribution Situations Reporting and Withholding Requirements for Taxable Amounts What Acts Result in Penalties or Additional Taxes?Prohibited Transactions Investment in Collectibles Excess Contributions Early Distributions Excess Accumulations (Insufficient Distributions) Reporting Additional Taxes What's New for 2013 Traditional IRA contribution and deduction limit. 1040ez tax table  The contribution limit to your traditional IRA for 2013 will be increased to the smaller of the following amounts: $5,500, or Your taxable compensation for the year. 1040ez tax table If you were age 50 or older before 2014, the most that can be contributed to your traditional IRA for 2013 will be the smaller of the following amounts: $6,500, or Your taxable compensation for the year. 1040ez tax table For more information, see How Much Can Be Contributed? in this chapter. 1040ez tax table Modified AGI limit for traditional IRA contributions increased. 1040ez tax table  For 2013, if you were covered by a retirement plan at work, your deduction for contributions to a traditional IRA is reduced (phased out) if your modified AGI is: More than $95,000 but less than $115,000 for a married couple filing a joint return or a qualifying widow(er), More than $59,000 but less than $69,000 for a single individual or head of household, or Less than $10,000 for a married individual filing a separate return. 1040ez tax table If you either lived with your spouse or file a joint return, and your spouse was covered by a retirement plan at work, but you were not, your deduction is phased out if your modified AGI is more than $178,000 but less than $188,000. 1040ez tax table If your modified AGI is $188,000 or more, you cannot take a deduction for contributions to a traditional IRA. 1040ez tax table See How Much Can You Deduct? in this chapter. 1040ez tax table Net Investment Income Tax. 1040ez tax table  For purposes of the Net Investment Income Tax (NIIT), net investment income does not include distributions from a qualified retirement plan (for example, 401(a), 403(a), 403(b), 457(b) plans, and IRAs). 1040ez tax table However, these distributions are taken into account when determining the modified adjusted gross income threshold. 1040ez tax table Distributions from a nonqualified retirement plan are included in net investment income. 1040ez tax table See Form 8960, Net Investment Income Tax—Individuals, Estates, and Trusts, and its instructions for more information. 1040ez tax table What's New for 2014 Modified AGI limit for traditional IRA contributions increased. 1040ez tax table  For 2014, if you are covered by a retirement plan at work, your deduction for contributions to a traditional IRA is reduced (phased out) if your modified AGI is: More than $96,000 but less than $116,000 for a married couple filing a joint return or a qualifying widow(er), More than $60,000 but less than $70,000 for a single individual or head of household, or Less than $10,000 for a married individual filing a separate return. 1040ez tax table If you either live with your spouse or file a joint return, and your spouse is covered by a retirement plan at work, but you are not, your deduction is phased out if your modified AGI is more than $181,000 but less than $191,000. 1040ez tax table If your modified AGI is $191,000 or more, you cannot take a deduction for contributions to a traditional IRA. 1040ez tax table Introduction This chapter discusses the original IRA. 1040ez tax table In this publication the original IRA (sometimes called an ordinary or regular IRA) is referred to as a “traditional IRA. 1040ez tax table ” A traditional IRA is any IRA that is not a Roth IRA or a SIMPLE IRA. 1040ez tax table The following are two advantages of a traditional IRA: You may be able to deduct some or all of your contributions to it, depending on your circumstances. 1040ez tax table Generally, amounts in your IRA, including earnings and gains, are not taxed until they are distributed. 1040ez tax table Who Can Open a Traditional IRA? You can open and make contributions to a traditional IRA if: You (or, if you file a joint return, your spouse) received taxable compensation during the year, and You were not age 70½ by the end of the year. 1040ez tax table You can have a traditional IRA whether or not you are covered by any other retirement plan. 1040ez tax table However, you may not be able to deduct all of your contributions if you or your spouse is covered by an employer retirement plan. 1040ez tax table See How Much Can You Deduct , later. 1040ez tax table Both spouses have compensation. 1040ez tax table   If both you and your spouse have compensation and are under age 70½, each of you can open an IRA. 1040ez tax table You cannot both participate in the same IRA. 1040ez tax table If you file a joint return, only one of you needs to have compensation. 1040ez tax table What Is Compensation? Generally, compensation is what you earn from working. 1040ez tax table For a summary of what compensation does and does not include, see Table 1-1. 1040ez tax table Compensation includes all of the items discussed next (even if you have more than one type). 1040ez tax table Wages, salaries, etc. 1040ez tax table   Wages, salaries, tips, professional fees, bonuses, and other amounts you receive for providing personal services are compensation. 1040ez tax table The IRS treats as compensation any amount properly shown in box 1 (Wages, tips, other compensation) of Form W-2, Wage and Tax Statement, provided that amount is reduced by any amount properly shown in box 11 (Nonqualified plans). 1040ez tax table Scholarship and fellowship payments are compensation for IRA purposes only if shown in box 1 of Form W-2. 1040ez tax table Commissions. 1040ez tax table   An amount you receive that is a percentage of profits or sales price is compensation. 1040ez tax table Self-employment income. 1040ez tax table   If you are self-employed (a sole proprietor or a partner), compensation is the net earnings from your trade or business (provided your personal services are a material income-producing factor) reduced by the total of: The deduction for contributions made on your behalf to retirement plans, and The deduction allowed for the deductible part of your self-employment taxes. 1040ez tax table   Compensation includes earnings from self-employment even if they are not subject to self-employment tax because of your religious beliefs. 1040ez tax table Self-employment loss. 1040ez tax table   If you have a net loss from self-employment, do not subtract the loss from your salaries or wages when figuring your total compensation. 1040ez tax table Alimony and separate maintenance. 1040ez tax table   For IRA purposes, compensation includes any taxable alimony and separate maintenance payments you receive under a decree of divorce or separate maintenance. 1040ez tax table Nontaxable combat pay. 1040ez tax table   If you were a member of the U. 1040ez tax table S. 1040ez tax table Armed Forces, compensation includes any nontaxable combat pay you received. 1040ez tax table This amount should be reported in box 12 of your 2013 Form W-2 with code Q. 1040ez tax table Table 1-1. 1040ez tax table Compensation for Purposes of an IRA Includes . 1040ez tax table . 1040ez tax table . 1040ez tax table Does not include . 1040ez tax table . 1040ez tax table . 1040ez tax table   earnings and profits from property. 1040ez tax table wages, salaries, etc. 1040ez tax table     interest and dividend income. 1040ez tax table commissions. 1040ez tax table     pension or annuity income. 1040ez tax table self-employment income. 1040ez tax table     deferred compensation. 1040ez tax table alimony and separate maintenance. 1040ez tax table     income from certain  partnerships. 1040ez tax table nontaxable combat pay. 1040ez tax table     any amounts you exclude from income. 1040ez tax table     What Is Not Compensation? Compensation does not include any of the following items. 1040ez tax table Earnings and profits from property, such as rental income, interest income, and dividend income. 1040ez tax table Pension or annuity income. 1040ez tax table Deferred compensation received (compensation payments postponed from a past year). 1040ez tax table Income from a partnership for which you do not provide services that are a material income-producing factor. 1040ez tax table Conservation Reserve Program (CRP) payments reported on Schedule SE (Form 1040), line 1b. 1040ez tax table Any amounts (other than combat pay) you exclude from income, such as foreign earned income and housing costs. 1040ez tax table When Can a Traditional IRA Be Opened? You can open a traditional IRA at any time. 1040ez tax table However, the time for making contributions for any year is limited. 1040ez tax table See When Can Contributions Be Made , later. 1040ez tax table How Can a Traditional IRA Be Opened? You can open different kinds of IRAs with a variety of organizations. 1040ez tax table You can open an IRA at a bank or other financial institution or with a mutual fund or life insurance company. 1040ez tax table You can also open an IRA through your stockbroker. 1040ez tax table Any IRA must meet Internal Revenue Code requirements. 1040ez tax table The requirements for the various arrangements are discussed below. 1040ez tax table Kinds of traditional IRAs. 1040ez tax table   Your traditional IRA can be an individual retirement account or annuity. 1040ez tax table It can be part of either a simplified employee pension (SEP) or an employer or employee association trust account. 1040ez tax table Individual Retirement Account An individual retirement account is a trust or custodial account set up in the United States for the exclusive benefit of you or your beneficiaries. 1040ez tax table The account is created by a written document. 1040ez tax table The document must show that the account meets all of the following requirements. 1040ez tax table The trustee or custodian must be a bank, a federally insured credit union, a savings and loan association, or an entity approved by the IRS to act as trustee or custodian. 1040ez tax table The trustee or custodian generally cannot accept contributions of more than the deductible amount for the year. 1040ez tax table However, rollover contributions and employer contributions to a simplified employee pension (SEP) can be more than this amount. 1040ez tax table Contributions, except for rollover contributions, must be in cash. 1040ez tax table See Rollovers , later. 1040ez tax table You must have a nonforfeitable right to the amount at all times. 1040ez tax table Money in your account cannot be used to buy a life insurance policy. 1040ez tax table Assets in your account cannot be combined with other property, except in a common trust fund or common investment fund. 1040ez tax table You must start receiving distributions by April 1 of the year following the year in which you reach age 70½. 1040ez tax table See When Must You Withdraw Assets? (Required Minimum Distributions) , later. 1040ez tax table Individual Retirement Annuity You can open an individual retirement annuity by purchasing an annuity contract or an endowment contract from a life insurance company. 1040ez tax table An individual retirement annuity must be issued in your name as the owner, and either you or your beneficiaries who survive you are the only ones who can receive the benefits or payments. 1040ez tax table An individual retirement annuity must meet all the following requirements. 1040ez tax table Your entire interest in the contract must be nonforfeitable. 1040ez tax table The contract must provide that you cannot transfer any portion of it to any person other than the issuer. 1040ez tax table There must be flexible premiums so that if your compensation changes, your payment can also change. 1040ez tax table This provision applies to contracts issued after November 6, 1978. 1040ez tax table The contract must provide that contributions cannot be more than the deductible amount for an IRA for the year, and that you must use any refunded premiums to pay for future premiums or to buy more benefits before the end of the calendar year after the year in which you receive the refund. 1040ez tax table Distributions must begin by April 1 of the year following the year in which you reach age 70½. 1040ez tax table See When Must You Withdraw Assets? (Required Minimum Distributions) , later. 1040ez tax table Individual Retirement Bonds The sale of individual retirement bonds issued by the federal government was suspended after April 30, 1982. 1040ez tax table The bonds have the following features. 1040ez tax table They stop earning interest when you reach age 70½. 1040ez tax table If you die, interest will stop 5 years after your death, or on the date you would have reached age 70½, whichever is earlier. 1040ez tax table You cannot transfer the bonds. 1040ez tax table If you cash (redeem) the bonds before the year in which you reach age 59½, you may be subject to a 10% additional tax. 1040ez tax table See Age 59½ Rule under Early Distributions, later. 1040ez tax table You can roll over redemption proceeds into IRAs. 1040ez tax table Simplified Employee Pension (SEP) A simplified employee pension (SEP) is a written arrangement that allows your employer to make deductible contributions to a traditional IRA (a SEP IRA) set up for you to receive such contributions. 1040ez tax table Generally, distributions from SEP IRAs are subject to the withdrawal and tax rules that apply to traditional IRAs. 1040ez tax table See Publication 560 for more information about SEPs. 1040ez tax table Employer and Employee Association Trust Accounts Your employer or your labor union or other employee association can set up a trust to provide individual retirement accounts for employees or members. 1040ez tax table The requirements for individual retirement accounts apply to these traditional IRAs. 1040ez tax table Required Disclosures The trustee or issuer (sometimes called the sponsor) of your traditional IRA generally must give you a disclosure statement at least 7 days before you open your IRA. 1040ez tax table However, the sponsor does not have to give you the statement until the date you open (or purchase, if earlier) your IRA, provided you are given at least 7 days from that date to revoke the IRA. 1040ez tax table The disclosure statement must explain certain items in plain language. 1040ez tax table For example, the statement should explain when and how you can revoke the IRA, and include the name, address, and telephone number of the person to receive the notice of cancellation. 1040ez tax table This explanation must appear at the beginning of the disclosure statement. 1040ez tax table If you revoke your IRA within the revocation period, the sponsor must return to you the entire amount you paid. 1040ez tax table The sponsor must report on the appropriate IRS forms both your contribution to the IRA (unless it was made by a trustee-to-trustee transfer) and the amount returned to you. 1040ez tax table These requirements apply to all sponsors. 1040ez tax table How Much Can Be Contributed? There are limits and other rules that affect the amount that can be contributed to a traditional IRA. 1040ez tax table These limits and rules are explained below. 1040ez tax table Community property laws. 1040ez tax table   Except as discussed later under Kay Bailey Hutchison Spousal IRA Limit , each spouse figures his or her limit separately, using his or her own compensation. 1040ez tax table This is the rule even in states with community property laws. 1040ez tax table Brokers' commissions. 1040ez tax table   Brokers' commissions paid in connection with your traditional IRA are subject to the contribution limit. 1040ez tax table For information about whether you can deduct brokers' commissions, see Brokers' commissions , later, under How Much Can You Deduct. 1040ez tax table Trustees' fees. 1040ez tax table   Trustees' administrative fees are not subject to the contribution limit. 1040ez tax table For information about whether you can deduct trustees' fees, see Trustees' fees , later, under How Much Can You Deduct. 1040ez tax table Qualified reservist repayments. 1040ez tax table   If you were a member of a reserve component and you were ordered or called to active duty after September 11, 2001, you may be able to contribute (repay) to an IRA amounts equal to any qualified reservist distributions (defined later under Early Distributions) you received. 1040ez tax table You can make these repayment contributions even if they would cause your total contributions to the IRA to be more than the general limit on contributions. 1040ez tax table To be eligible to make these repayment contributions, you must have received a qualified reservist distribution from an IRA or from a section 401(k) or 403(b) plan or a similar arrangement. 1040ez tax table Limit. 1040ez tax table   Your qualified reservist repayments cannot be more than your qualified reservist distributions, explained under Early Distributions , later. 1040ez tax table When repayment contributions can be made. 1040ez tax table   You cannot make these repayment contributions later than the date that is 2 years after your active duty period ends. 1040ez tax table No deduction. 1040ez tax table   You cannot deduct qualified reservist repayments. 1040ez tax table Reserve component. 1040ez tax table   The term “reserve component” means the: Army National Guard of the United States, Army Reserve, Naval Reserve, Marine Corps Reserve, Air National Guard of the United States, Air Force Reserve, Coast Guard Reserve, or Reserve Corps of the Public Health Service. 1040ez tax table Figuring your IRA deduction. 1040ez tax table   The repayment of qualified reservist distributions does not affect the amount you can deduct as an IRA contribution. 1040ez tax table Reporting the repayment. 1040ez tax table   If you repay a qualified reservist distribution, include the amount of the repayment with nondeductible contributions on line 1 of Form 8606. 1040ez tax table Example. 1040ez tax table   In 2013, your IRA contribution limit is $5,500. 1040ez tax table However, because of your filing status and AGI, the limit on the amount you can deduct is $3,500. 1040ez tax table You can make a nondeductible contribution of $2,000 ($5,500 - $3,500). 1040ez tax table In an earlier year you received a $3,000 qualified reservist distribution, which you would like to repay this year. 1040ez tax table   For 2013, you can contribute a total of $8,500 to your IRA. 1040ez tax table This is made up of the maximum deductible contribution of $3,500; a nondeductible contribution of $2,000; and a $3,000 qualified reservist repayment. 1040ez tax table You contribute the maximum allowable for the year. 1040ez tax table Since you are making a nondeductible contribution ($2,000) and a qualified reservist repayment ($3,000), you must file Form 8606 with your return and include $5,000 ($2,000 + $3,000) on line 1 of Form 8606. 1040ez tax table The qualified reservist repayment is not deductible. 1040ez tax table Contributions on your behalf to a traditional IRA reduce your limit for contributions to a Roth IRA. 1040ez tax table See chapter 2 for information about Roth IRAs. 1040ez tax table General Limit For 2013, the most that can be contributed to your traditional IRA generally is the smaller of the following amounts: $5,500 ($6,500 if you are age 50 or older), or Your taxable compensation (defined earlier) for the year. 1040ez tax table Note. 1040ez tax table This limit is reduced by any contributions to a section 501(c)(18) plan (generally, a pension plan created before June 25, 1959, that is funded entirely by employee contributions). 1040ez tax table This is the most that can be contributed regardless of whether the contributions are to one or more traditional IRAs or whether all or part of the contributions are nondeductible. 1040ez tax table (See Nondeductible Contributions , later. 1040ez tax table ) Qualified reservist repayments do not affect this limit. 1040ez tax table Examples. 1040ez tax table George, who is 34 years old and single, earns $24,000 in 2013. 1040ez tax table His IRA contributions for 2013 are limited to $5,500. 1040ez tax table Danny, an unmarried college student working part time, earns $3,500 in 2013. 1040ez tax table His IRA contributions for 2013 are limited to $3,500, the amount of his compensation. 1040ez tax table More than one IRA. 1040ez tax table   If you have more than one IRA, the limit applies to the total contributions made on your behalf to all your traditional IRAs for the year. 1040ez tax table Annuity or endowment contracts. 1040ez tax table   If you invest in an annuity or endowment contract under an individual retirement annuity, no more than $5,500 ($6,500 if you are age 50 or older) can be contributed toward its cost for the tax year, including the cost of life insurance coverage. 1040ez tax table If more than this amount is contributed, the annuity or endowment contract is disqualified. 1040ez tax table Kay Bailey Hutchison Spousal IRA Limit For 2013, if you file a joint return and your taxable compensation is less than that of your spouse, the most that can be contributed for the year to your IRA is the smaller of the following two amounts: $5,500 ($6,500 if you are age 50 or older), or The total compensation includible in the gross income of both you and your spouse for the year, reduced by the following two amounts. 1040ez tax table Your spouse's IRA contribution for the year to a traditional IRA. 1040ez tax table Any contributions for the year to a Roth IRA on behalf of your spouse. 1040ez tax table This means that the total combined contributions that can be made for the year to your IRA and your spouse's IRA can be as much as $11,000 ($12,000 if only one of you is age 50 or older or $13,000 if both of you are age 50 or older). 1040ez tax table Note. 1040ez tax table This traditional IRA limit is reduced by any contributions to a section 501(c)(18) plan (generally, a pension plan created before June 25, 1959, that is funded entirely by employee contributions). 1040ez tax table Example. 1040ez tax table Kristin, a full-time student with no taxable compensation, marries Carl during the year. 1040ez tax table Neither of them was age 50 by the end of 2013. 1040ez tax table For the year, Carl has taxable compensation of $30,000. 1040ez tax table He plans to contribute (and deduct) $5,500 to a traditional IRA. 1040ez tax table If he and Kristin file a joint return, each can contribute $5,500 to a traditional IRA. 1040ez tax table This is because Kristin, who has no compensation, can add Carl's compensation, reduced by the amount of his IRA contribution ($30,000 − $5,500 = $24,500), to her own compensation (-0-) to figure her maximum contribution to a traditional IRA. 1040ez tax table In her case, $5,500 is her contribution limit, because $5,500 is less than $24,500 (her compensation for purposes of figuring her contribution limit). 1040ez tax table Filing Status Generally, except as discussed earlier under Kay Bailey Hutchison Spousal IRA Limit , your filing status has no effect on the amount of allowable contributions to your traditional IRA. 1040ez tax table However, if during the year either you or your spouse was covered by a retirement plan at work, your deduction may be reduced or eliminated, depending on your filing status and income. 1040ez tax table See How Much Can You Deduct , later. 1040ez tax table Example. 1040ez tax table Tom and Darcy are married and both are 53. 1040ez tax table They both work and each has a traditional IRA. 1040ez tax table Tom earned $3,800 and Darcy earned $48,000 in 2013. 1040ez tax table Because of the Kay Bailey Hutchison Spousal IRA limit rule, even though Tom earned less than $6,500, they can contribute up to $6,500 to his IRA for 2013 if they file a joint return. 1040ez tax table They can contribute up to $6,500 to Darcy's IRA. 1040ez tax table If they file separate returns, the amount that can be contributed to Tom's IRA is limited by his earned income, $3,800. 1040ez tax table Less Than Maximum Contributions If contributions to your traditional IRA for a year were less than the limit, you cannot contribute more after the due date of your return for that year to make up the difference. 1040ez tax table Example. 1040ez tax table Rafael, who is 40, earns $30,000 in 2013. 1040ez tax table Although he can contribute up to $5,500 for 2013, he contributes only $3,000. 1040ez tax table After April 15, 2014, Rafael cannot make up the difference between his actual contributions for 2013 ($3,000) and his 2013 limit ($5,500). 1040ez tax table He cannot contribute $2,500 more than the limit for any later year. 1040ez tax table More Than Maximum Contributions If contributions to your IRA for a year were more than the limit, you can apply the excess contribution in one year to a later year if the contributions for that later year are less than the maximum allowed for that year. 1040ez tax table However, a penalty or additional tax may apply. 1040ez tax table See Excess Contributions , later, under What Acts Result in Penalties or Additional Taxes. 1040ez tax table When Can Contributions Be Made? As soon as you open your traditional IRA, contributions can be made to it through your chosen sponsor (trustee or other administrator). 1040ez tax table Contributions must be in the form of money (cash, check, or money order). 1040ez tax table Property cannot be contributed. 1040ez tax table Although property cannot be contributed, your IRA may invest in certain property. 1040ez tax table For example, your IRA may purchase shares of stock. 1040ez tax table For other restrictions on the use of funds in your IRA, see Prohibited Transactions , later in this chapter. 1040ez tax table You may be able to transfer or roll over certain property from one retirement plan to another. 1040ez tax table See the discussion of rollovers and other transfers later in this chapter under Can You Move Retirement Plan Assets . 1040ez tax table You can make a contribution to your IRA by having your income tax refund (or a portion of your refund), if any, paid directly to your traditional IRA, Roth IRA, or SEP IRA. 1040ez tax table For details, see the instructions for your income tax return or Form 8888, Allocation of Refund (Including Savings Bond Purchases). 1040ez tax table Contributions can be made to your traditional IRA for each year that you receive compensation and have not reached age 70½. 1040ez tax table For any year in which you do not work, contributions cannot be made to your IRA unless you receive alimony, nontaxable combat pay, military differential pay, or file a joint return with a spouse who has compensation. 1040ez tax table See Who Can Open a Traditional IRA , earlier. 1040ez tax table Even if contributions cannot be made for the current year, the amounts contributed for years in which you did qualify can remain in your IRA. 1040ez tax table Contributions can resume for any years that you qualify. 1040ez tax table Contributions must be made by due date. 1040ez tax table   Contributions can be made to your traditional IRA for a year at any time during the year or by the due date for filing your return for that year, not including extensions. 1040ez tax table For most people, this means that contributions for 2013 must be made by April 15, 2014, and contributions for 2014 must be made by April 15, 2015. 1040ez tax table Age 70½ rule. 1040ez tax table   Contributions cannot be made to your traditional IRA for the year in which you reach age 70½ or for any later year. 1040ez tax table   You attain age 70½ on the date that is 6 calendar months after the 70th anniversary of your birth. 1040ez tax table If you were born on or before June 30, 1943, you cannot contribute for 2013 or any later year. 1040ez tax table Designating year for which contribution is made. 1040ez tax table   If an amount is contributed to your traditional IRA between January 1 and April 15, you should tell the sponsor which year (the current year or the previous year) the contribution is for. 1040ez tax table If you do not tell the sponsor which year it is for, the sponsor can assume, and report to the IRS, that the contribution is for the current year (the year the sponsor received it). 1040ez tax table Filing before a contribution is made. 1040ez tax table    You can file your return claiming a traditional IRA contribution before the contribution is actually made. 1040ez tax table Generally, the contribution must be made by the due date of your return, not including extensions. 1040ez tax table Contributions not required. 1040ez tax table   You do not have to contribute to your traditional IRA for every tax year, even if you can. 1040ez tax table How Much Can You Deduct? Generally, you can deduct the lesser of: The contributions to your traditional IRA for the year, or The general limit (or the Kay Bailey Hutchison Spousal IRA limit, if applicable) explained earlier under How Much Can Be Contributed . 1040ez tax table However, if you or your spouse was covered by an employer retirement plan, you may not be able to deduct this amount. 1040ez tax table See Limit if Covered by Employer Plan , later. 1040ez tax table You may be able to claim a credit for contributions to your traditional IRA. 1040ez tax table For more information, see chapter 4. 1040ez tax table Trustees' fees. 1040ez tax table   Trustees' administrative fees that are billed separately and paid in connection with your traditional IRA are not deductible as IRA contributions. 1040ez tax table However, they may be deductible as a miscellaneous itemized deduction on Schedule A (Form 1040). 1040ez tax table For information about miscellaneous itemized deductions, see Publication 529, Miscellaneous Deductions. 1040ez tax table Brokers' commissions. 1040ez tax table   These commissions are part of your IRA contribution and, as such, are deductible subject to the limits. 1040ez tax table Full deduction. 1040ez tax table   If neither you nor your spouse was covered for any part of the year by an employer retirement plan, you can take a deduction for total contributions to one or more of your traditional IRAs of up to the lesser of: $5,500 ($6,500 if you are age 50 or older), or 100% of your compensation. 1040ez tax table   This limit is reduced by any contributions made to a 501(c)(18) plan on your behalf. 1040ez tax table Kay Bailey Hutchison Spousal IRA. 1040ez tax table   In the case of a married couple with unequal compensation who file a joint return, the deduction for contributions to the traditional IRA of the spouse with less compensation is limited to the lesser of: $5,500 ($6,500 if the spouse with the lower compensation is age 50 or older), or The total compensation includible in the gross income of both spouses for the year reduced by the following three amounts. 1040ez tax table The IRA deduction for the year of the spouse with the greater compensation. 1040ez tax table Any designated nondeductible contribution for the year made on behalf of the spouse with the greater compensation. 1040ez tax table Any contributions for the year to a Roth IRA on behalf of the spouse with the greater compensation. 1040ez tax table   This limit is reduced by any contributions to a section 501(c)(18) plan on behalf of the spouse with the lesser compensation. 1040ez tax table Note. 1040ez tax table If you were divorced or legally separated (and did not remarry) before the end of the year, you cannot deduct any contributions to your spouse's IRA. 1040ez tax table After a divorce or legal separation, you can deduct only the contributions to your own IRA. 1040ez tax table Your deductions are subject to the rules for single individuals. 1040ez tax table Covered by an employer retirement plan. 1040ez tax table   If you or your spouse was covered by an employer retirement plan at any time during the year for which contributions were made, your deduction may be further limited. 1040ez tax table This is discussed later under Limit if Covered by Employer Plan . 1040ez tax table Limits on the amount you can deduct do not affect the amount that can be contributed. 1040ez tax table Are You Covered by an Employer Plan? The Form W-2 you receive from your employer has a box used to indicate whether you were covered for the year. 1040ez tax table The “Retirement Plan” box should be checked if you were covered. 1040ez tax table Reservists and volunteer firefighters should also see Situations in Which You Are Not Covered , later. 1040ez tax table If you are not certain whether you were covered by your employer's retirement plan, you should ask your employer. 1040ez tax table Federal judges. 1040ez tax table   For purposes of the IRA deduction, federal judges are covered by an employer plan. 1040ez tax table For Which Year(s) Are You Covered? Special rules apply to determine the tax years for which you are covered by an employer plan. 1040ez tax table These rules differ depending on whether the plan is a defined contribution plan or a defined benefit plan. 1040ez tax table Tax year. 1040ez tax table   Your tax year is the annual accounting period you use to keep records and report income and expenses on your income tax return. 1040ez tax table For almost all people, the tax year is the calendar year. 1040ez tax table Defined contribution plan. 1040ez tax table   Generally, you are covered by a defined contribution plan for a tax year if amounts are contributed or allocated to your account for the plan year that ends with or within that tax year. 1040ez tax table However, also see Situations in Which You Are Not Covered , later. 1040ez tax table   A defined contribution plan is a plan that provides for a separate account for each person covered by the plan. 1040ez tax table In a defined contribution plan, the amount to be contributed to each participant's account is spelled out in the plan. 1040ez tax table The level of benefits actually provided to a participant depends on the total amount contributed to that participant's account and any earnings and losses on those contributions. 1040ez tax table Types of defined contribution plans include profit-sharing plans, stock bonus plans, and money purchase pension plans. 1040ez tax table Example. 1040ez tax table Company A has a money purchase pension plan. 1040ez tax table Its plan year is from July 1 to June 30. 1040ez tax table The plan provides that contributions must be allocated as of June 30. 1040ez tax table Bob, an employee, leaves Company A on December 31, 2012. 1040ez tax table The contribution for the plan year ending on June 30, 2013, is made February 15, 2014. 1040ez tax table Because an amount is contributed to Bob's account for the plan year, Bob is covered by the plan for his 2013 tax year. 1040ez tax table   A special rule applies to certain plans in which it is not possible to determine if an amount will be contributed to your account for a given plan year. 1040ez tax table If, for a plan year, no amounts have been allocated to your account that are attributable to employer contributions, employee contributions, or forfeitures, by the last day of the plan year, and contributions are discretionary for the plan year, you are not covered for the tax year in which the plan year ends. 1040ez tax table If, after the plan year ends, the employer makes a contribution for that plan year, you are covered for the tax year in which the contribution is made. 1040ez tax table Example. 1040ez tax table Mickey was covered by a profit-sharing plan and left the company on December 31, 2012. 1040ez tax table The plan year runs from July 1 to June 30. 1040ez tax table Under the terms of the plan, employer contributions do not have to be made, but if they are made, they are contributed to the plan before the due date for filing the company's tax return. 1040ez tax table Such contributions are allocated as of the last day of the plan year, and allocations are made to the accounts of individuals who have any service during the plan year. 1040ez tax table As of June 30, 2013, no contributions were made that were allocated to the June 30, 2013, plan year, and no forfeitures had been allocated within the plan year. 1040ez tax table In addition, as of that date, the company was not obligated to make a contribution for such plan year and it was impossible to determine whether or not a contribution would be made for the plan year. 1040ez tax table On December 31, 2013, the company decided to contribute to the plan for the plan year ending June 30, 2013. 1040ez tax table That contribution was made on February 15, 2014. 1040ez tax table Mickey is an active participant in the plan for his 2014 tax year but not for his 2013 tax year. 1040ez tax table No vested interest. 1040ez tax table   If an amount is allocated to your account for a plan year, you are covered by that plan even if you have no vested interest in (legal right to) the account. 1040ez tax table Defined benefit plan. 1040ez tax table   If you are eligible to participate in your employer's defined benefit plan for the plan year that ends within your tax year, you are covered by the plan. 1040ez tax table This rule applies even if you: Declined to participate in the plan, Did not make a required contribution, or Did not perform the minimum service required to accrue a benefit for the year. 1040ez tax table   A defined benefit plan is any plan that is not a defined contribution plan. 1040ez tax table In a defined benefit plan, the level of benefits to be provided to each participant is spelled out in the plan. 1040ez tax table The plan administrator figures the amount needed to provide those benefits and those amounts are contributed to the plan. 1040ez tax table Defined benefit plans include pension plans and annuity plans. 1040ez tax table Example. 1040ez tax table Nick, an employee of Company B, is eligible to participate in Company B's defined benefit plan, which has a July 1 to June 30 plan year. 1040ez tax table Nick leaves Company B on December 31, 2012. 1040ez tax table Because Nick is eligible to participate in the plan for its year ending June 30, 2013, he is covered by the plan for his 2013 tax year. 1040ez tax table No vested interest. 1040ez tax table   If you accrue a benefit for a plan year, you are covered by that plan even if you have no vested interest in (legal right to) the accrual. 1040ez tax table Situations in Which You Are Not Covered Unless you are covered by another employer plan, you are not covered by an employer plan if you are in one of the situations described below. 1040ez tax table Social security or railroad retirement. 1040ez tax table   Coverage under social security or railroad retirement is not coverage under an employer retirement plan. 1040ez tax table Benefits from previous employer's plan. 1040ez tax table   If you receive retirement benefits from a previous employer's plan, you are not covered by that plan. 1040ez tax table Reservists. 1040ez tax table   If the only reason you participate in a plan is because you are a member of a reserve unit of the Armed Forces, you may not be covered by the plan. 1040ez tax table You are not covered by the plan if both of the following conditions are met. 1040ez tax table The plan you participate in is established for its employees by: The United States, A state or political subdivision of a state, or An instrumentality of either (a) or (b) above. 1040ez tax table You did not serve more than 90 days on active duty during the year (not counting duty for training). 1040ez tax table Volunteer firefighters. 1040ez tax table   If the only reason you participate in a plan is because you are a volunteer firefighter, you may not be covered by the plan. 1040ez tax table You are not covered by the plan if both of the following conditions are met. 1040ez tax table The plan you participate in is established for its employees by: The United States, A state or political subdivision of a state, or An instrumentality of either (a) or (b) above. 1040ez tax table Your accrued retirement benefits at the beginning of the year will not provide more than $1,800 per year at retirement. 1040ez tax table Limit if Covered by Employer Plan As discussed earlier, the deduction you can take for contributions made to your traditional IRA depends on whether you or your spouse was covered for any part of the year by an employer retirement plan. 1040ez tax table Your deduction is also affected by how much income you had and by your filing status. 1040ez tax table Your deduction may also be affected by social security benefits you received. 1040ez tax table Reduced or no deduction. 1040ez tax table   If either you or your spouse was covered by an employer retirement plan, you may be entitled to only a partial (reduced) deduction or no deduction at all, depending on your income and your filing status. 1040ez tax table   Your deduction begins to decrease (phase out) when your income rises above a certain amount and is eliminated altogether when it reaches a higher amount. 1040ez tax table These amounts vary depending on your filing status. 1040ez tax table   To determine if your deduction is subject to the phaseout, you must determine your modified adjusted gross income (AGI) and your filing status, as explained later under Deduction Phaseout . 1040ez tax table Once you have determined your modified AGI and your filing status, you can use Table 1-2 or Table 1-3 to determine if the phaseout applies. 1040ez tax table Social Security Recipients Instead of using Table 1-2 or Table 1-3 and Worksheet 1-2, Figuring Your Reduced IRA Deduction for 2013, later, complete the worksheets in Appendix B of this publication if, for the year, all of the following apply. 1040ez tax table You received social security benefits. 1040ez tax table You received taxable compensation. 1040ez tax table Contributions were made to your traditional IRA. 1040ez tax table You or your spouse was covered by an employer retirement plan. 1040ez tax table Use the worksheets in Appendix B to figure your IRA deduction, your nondeductible contribution, and the taxable portion, if any, of your social security benefits. 1040ez tax table Appendix B includes an example with filled-in worksheets to assist you. 1040ez tax table Table 1-2. 1040ez tax table Effect of Modified AGI1 on Deduction if You Are Covered by a Retirement Plan at Work If you are covered by a retirement plan at work, use this table to determine if your modified AGI affects the amount of your deduction. 1040ez tax table IF your filing status is . 1040ez tax table . 1040ez tax table . 1040ez tax table AND your modified adjusted gross income (modified AGI) is . 1040ez tax table . 1040ez tax table . 1040ez tax table THEN you can take . 1040ez tax table . 1040ez tax table . 1040ez tax table single or head of household $59,000 or less a full deduction. 1040ez tax table more than $59,000 but less than $69,000 a partial deduction. 1040ez tax table $69,000 or more no deduction. 1040ez tax table married filing jointly or  qualifying widow(er) $95,000 or less a full deduction. 1040ez tax table more than $95,000 but less than $115,000 a partial deduction. 1040ez tax table $115,000 or more no deduction. 1040ez tax table married filing separately2 less than $10,000 a partial deduction. 1040ez tax table $10,000 or more no deduction. 1040ez tax table 1 Modified AGI (adjusted gross income). 1040ez tax table See Modified adjusted gross income (AGI) , later. 1040ez tax table  2 If you did not live with your spouse at any time during the year, your filing status is considered Single for this purpose (therefore, your IRA deduction is determined under the “Single” filing status). 1040ez tax table Table 1-3. 1040ez tax table Effect of Modified AGI1 on Deduction if You Are NOT Covered by a Retirement Plan at Work If you are not covered by a retirement plan at work, use this table to determine if your modified AGI affects the amount of your deduction. 1040ez tax table IF your filing status is . 1040ez tax table . 1040ez tax table . 1040ez tax table AND your modified adjusted gross income (modified AGI) is . 1040ez tax table . 1040ez tax table . 1040ez tax table THEN you can take . 1040ez tax table . 1040ez tax table . 1040ez tax table single, head of household, or qualifying widow(er) any amount a full deduction. 1040ez tax table married filing jointly or separately with a spouse who is not covered by a plan at work any amount a full deduction. 1040ez tax table married filing jointly with a spouse who is covered by a plan at work $178,000 or less a full deduction. 1040ez tax table more than $178,000 but less than $188,000 a partial deduction. 1040ez tax table $188,000 or more no deduction. 1040ez tax table married filing separately with a spouse who is covered by a plan at work2 less than $10,000 a partial deduction. 1040ez tax table $10,000 or more no deduction. 1040ez tax table 1 Modified AGI (adjusted gross income). 1040ez tax table See Modified adjusted gross income (AGI) , later. 1040ez tax table  2 You are entitled to the full deduction if you did not live with your spouse at any time during the year. 1040ez tax table For 2014, if you are not covered by a retirement plan at work and you are married filing jointly with a spouse who is covered by a plan at work, your deduction is phased out if your modified AGI is more than $181,000 but less than $191,000. 1040ez tax table If your AGI is $191,000 or more, you cannot take a deduction for a contribution to a traditional IRA. 1040ez tax table Deduction Phaseout The amount of any reduction in the limit on your IRA deduction (phaseout) depends on whether you or your spouse was covered by an employer retirement plan. 1040ez tax table Covered by a retirement plan. 1040ez tax table   If you are covered by an employer retirement plan and you did not receive any social security retirement benefits, your IRA deduction may be reduced or eliminated depending on your filing status and modified AGI, as shown in Table 1-2. 1040ez tax table For 2014, if you are covered by a retirement plan at work, your IRA deduction will not be reduced (phased out) unless your modified AGI is: More than $60,000 but less than $70,000 for a single individual (or head of household), More than $96,000 but less than $116,000 for a married couple filing a joint return (or a qualifying widow(er)), or Less than $10,000 for a married individual filing a separate return. 1040ez tax table If your spouse is covered. 1040ez tax table   If you are not covered by an employer retirement plan, but your spouse is, and you did not receive any social security benefits, your IRA deduction may be reduced or eliminated entirely depending on your filing status and modified AGI as shown in Table 1-3. 1040ez tax table Filing status. 1040ez tax table   Your filing status depends primarily on your marital status. 1040ez tax table For this purpose, you need to know if your filing status is single or head of household, married filing jointly or qualifying widow(er), or married filing separately. 1040ez tax table If you need more information on filing status, see Publication 501, Exemptions, Standard Deduction, and Filing Information. 1040ez tax table Lived apart from spouse. 1040ez tax table   If you did not live with your spouse at any time during the year and you file a separate return, your filing status, for this purpose, is single. 1040ez tax table Modified adjusted gross income (AGI). 1040ez tax table   You can use Worksheet 1-1 to figure your modified AGI. 1040ez tax table If you made contributions to your IRA for 2013 and received a distribution from your IRA in 2013, see Both contributions for 2013 and distributions in 2013 , later. 1040ez tax table    Do not assume that your modified AGI is the same as your compensation. 1040ez tax table Your modified AGI may include income in addition to your compensation (discussed earlier) such as interest, dividends, and income from IRA distributions. 1040ez tax table Form 1040. 1040ez tax table   If you file Form 1040, refigure the amount on the page 1 “adjusted gross income” line without taking into account any of the following amounts. 1040ez tax table IRA deduction. 1040ez tax table Student loan interest deduction. 1040ez tax table Tuition and fees deduction. 1040ez tax table Domestic production activities deduction. 1040ez tax table Foreign earned income exclusion. 1040ez tax table Foreign housing exclusion or deduction. 1040ez tax table Exclusion of qualified savings bond interest shown on Form 8815. 1040ez tax table Exclusion of employer-provided adoption benefits shown on Form 8839. 1040ez tax table This is your modified AGI. 1040ez tax table Form 1040A. 1040ez tax table   If you file Form 1040A, refigure the amount on the page 1 “adjusted gross income” line without taking into account any of the following amounts. 1040ez tax table IRA deduction. 1040ez tax table Student loan interest deduction. 1040ez tax table Tuition and fees deduction. 1040ez tax table Exclusion of qualified savings bond interest shown on Form 8815. 1040ez tax table This is your modified AGI. 1040ez tax table Form 1040NR. 1040ez tax table   If you file Form 1040NR, refigure the amount on the page 1 “adjusted gross income” line without taking into account any of the following amounts. 1040ez tax table IRA deduction. 1040ez tax table Student loan interest deduction. 1040ez tax table Domestic production activities deduction. 1040ez tax table Exclusion of qualified savings bond interest shown on Form 8815. 1040ez tax table Exclusion of employer-provided adoption benefits shown on Form 8839. 1040ez tax table This is your modified AGI. 1040ez tax table Income from IRA distributions. 1040ez tax table   If you received distributions in 2013 from one or more traditional IRAs and your traditional IRAs include only deductible contributions, the distributions are fully taxable and are included in your modified AGI. 1040ez tax table Both contributions for 2013 and distributions in 2013. 1040ez tax table   If all three of the following apply, any IRA distributions you received in 2013 may be partly tax free and partly taxable. 1040ez tax table You received distributions in 2013 from one or more traditional IRAs, You made contributions to a traditional IRA for 2013, and Some of those contributions may be nondeductible contributions. 1040ez tax table (See Nondeductible Contributions and Worksheet 1-2, later. 1040ez tax table ) If this is your situation, you must figure the taxable part of the traditional IRA distribution before you can figure your modified AGI. 1040ez tax table To do this, you can use Worksheet 1-5, later. 1040ez tax table   If at least one of the above does not apply, figure your modified AGI using Worksheet 1-1, later. 1040ez tax table How To Figure Your Reduced IRA Deduction If you or your spouse is covered by an employer retirement plan and you did not receive any social security benefits, you can figure your reduced IRA deduction by using Worksheet 1-2. 1040ez tax table Figuring Your Reduced IRA Deduction for 2013. 1040ez tax table The Instructions for Form 1040, Form 1040A, and Form 1040NR include similar worksheets that you can use instead of the worksheet in this publication. 1040ez tax table If you or your spouse is covered by an employer retirement plan, and you received any social security benefits, see Social Security Recipients , earlier. 1040ez tax table Note. 1040ez tax table If you were married and both you and your spouse contributed to IRAs, figure your deduction and your spouse's deduction separately. 1040ez tax table Worksheet 1-1. 1040ez tax table Figuring Your Modified AGI Use this worksheet to figure your modified AGI for traditional IRA purposes. 1040ez tax table 1. 1040ez tax table Enter your adjusted gross income (AGI) from Form 1040, line 38; Form 1040A, line 22; or Form 1040NR, line 37, figured without taking into account the amount from Form 1040, line 32; Form 1040A, line 17; or Form 1040NR, line 32 1. 1040ez tax table   2. 1040ez tax table Enter any student loan interest deduction from Form 1040, line 33; Form 1040A, line 18; or Form 1040NR, line 33 2. 1040ez tax table   3. 1040ez tax table Enter any tuition and fees deduction from Form 1040, line 34, or Form 1040A, line 19 3. 1040ez tax table   4. 1040ez tax table Enter any domestic production activities deduction from Form 1040, line 35, or Form 1040NR, line 34 4. 1040ez tax table   5. 1040ez tax table Enter any foreign earned income exclusion and/or housing exclusion from Form 2555, line 45, or Form 2555-EZ, line 18 5. 1040ez tax table   6. 1040ez tax table Enter any foreign housing deduction from Form 2555, line 50 6. 1040ez tax table   7. 1040ez tax table Enter any excludable savings bond interest from Form 8815, line 14 7. 1040ez tax table   8. 1040ez tax table Enter any excluded employer-provided adoption benefits from Form 8839, line 28 8. 1040ez tax table   9. 1040ez tax table Add lines 1 through 8. 1040ez tax table This is your Modified AGI for traditional IRA purposes 9. 1040ez tax table   Reporting Deductible Contributions If you file Form 1040, enter your IRA deduction on line 32 of that form. 1040ez tax table If you file Form 1040A, enter your IRA deduction on line 17 of that form. 1040ez tax table If you file Form 1040NR, enter your IRA deduction on line 32 of that form. 1040ez tax table You cannot deduct IRA contributions on Form 1040EZ or Form 1040NR-EZ. 1040ez tax table Self-employed. 1040ez tax table   If you are self-employed (a sole proprietor or partner) and have a SIMPLE IRA, enter your deduction for allowable plan contributions on Form 1040, line 28. 1040ez tax table If you file Form 1040NR, enter your deduction on line 28 of that form. 1040ez tax table Nondeductible Contributions Although your deduction for IRA contributions may be reduced or eliminated, contributions can be made to your IRA of up to the general limit or, if it applies, the Kay Bailey Hutchison Spousal IRA limit. 1040ez tax table The difference between your total permitted contributions and your IRA deduction, if any, is your nondeductible contribution. 1040ez tax table Example. 1040ez tax table Tony is 29 years old and single. 1040ez tax table In 2013, he was covered by a retirement plan at work. 1040ez tax table His salary is $62,000. 1040ez tax table His modified AGI is $70,000. 1040ez tax table Tony makes a $5,500 IRA contribution for 2013. 1040ez tax table Because he was covered by a retirement plan and his modified AGI is above $69,000, he cannot deduct his $5,500 IRA contribution. 1040ez tax table He must designate this contribution as a nondeductible contribution by reporting it on Form 8606. 1040ez tax table Repayment of reservist distributions. 1040ez tax table   Nondeductible contributions may include repayments of qualified reservist distributions. 1040ez tax table For more information, see Qualified reservist repayments under How Much Can Be Contributed, earlier. 1040ez tax table Form 8606. 1040ez tax table   To designate contributions as nondeductible, you must file Form 8606. 1040ez tax table (See the filled-in Forms 8606 in this chapter. 1040ez tax table )   You do not have to designate a contribution as nondeductible until you file your tax return. 1040ez tax table When you file, you can even designate otherwise deductible contributions as nondeductible contributions. 1040ez tax table   You must file Form 8606 to report nondeductible contributions even if you do not have to file a tax return for the year. 1040ez tax table    A Form 8606 is not used for the year that you make a rollover from a qualified retirement plan to a traditional IRA and the rollover includes nontaxable amounts. 1040ez tax table In those situations, a Form 8606 is completed for the year you take a distribution from that IRA. 1040ez tax table See Form 8606 under Distributions Fully or Partly Taxable, later. 1040ez tax table Failure to report nondeductible contributions. 1040ez tax table   If you do not report nondeductible contributions, all of the contributions to your traditional IRA will be treated like deductible contributions when withdrawn. 1040ez tax table All distributions from your IRA will be taxed unless you can show, with satisfactory evidence, that nondeductible contributions were made. 1040ez tax table Penalty for overstatement. 1040ez tax table   If you overstate the amount of nondeductible contributions on your Form 8606 for any tax year, you must pay a penalty of $100 for each overstatement, unless it was due to reasonable cause. 1040ez tax table Penalty for failure to file Form 8606. 1040ez tax table   You will have to pay a $50 penalty if you do not file a required Form 8606, unless you can prove that the failure was due to reasonable cause. 1040ez tax table Tax on earnings on nondeductible contributions. 1040ez tax table   As long as contributions are within the contribution limits, none of the earnings or gains on contributions (deductible or nondeductible) will be taxed until they are distributed. 1040ez tax table Cost basis. 1040ez tax table   You will have a cost basis in your traditional IRA if you made any nondeductible contributions. 1040ez tax table Your cost basis is the sum of the nondeductible contributions to your IRA minus any withdrawals or distributions of nondeductible contributions. 1040ez tax table    Commonly, distributions from your traditional IRAs will include both taxable and nontaxable (cost basis) amounts. 1040ez tax table See Are Distributions Taxable, later, for more information. 1040ez tax table Recordkeeping. 1040ez tax table There is a recordkeeping worksheet, Appendix A. 1040ez tax table Summary Record of Traditional IRA(s) for 2013 , that you can use to keep a record of deductible and nondeductible IRA contributions. 1040ez tax table Examples — Worksheet for Reduced IRA Deduction for 2013 The following examples illustrate the use of Worksheet 1-2, Figuring Your Reduced IRA Deduction for 2013. 1040ez tax table Example 1. 1040ez tax table For 2013, Tom and Betty file a joint return on Form 1040. 1040ez tax table They are both 39 years old. 1040ez tax table They are both employed and Tom is covered by his employer's retirement plan. 1040ez tax table Tom's salary is $59,000 and Betty's is $32,555. 1040ez tax table They each have a traditional IRA and their combined modified AGI, which includes $5,000 interest and dividend income, is $96,555. 1040ez tax table Because their modified AGI is between $95,000 and $115,000 and Tom is covered by an employer plan, Tom is subject to the deduction phaseout discussed earlier under Limit if Covered by Employer Plan . 1040ez tax table For 2013, Tom contributed $5,500 to his IRA and Betty contributed $5,500 to hers. 1040ez tax table Even though they file a joint return, they must use separate worksheets to figure the IRA deduction for each of them. 1040ez tax table Tom can take a deduction of only $5,080. 1040ez tax table He can choose to treat the $5,080 as either deductible or nondeductible contributions. 1040ez tax table He can either leave the $420 ($5,500 − $5,080) of nondeductible contributions in his IRA or withdraw them by April 15, 2014. 1040ez tax table He decides to treat the $5,080 as deductible contributions and leave the $420 of nondeductible contributions in his IRA. 1040ez tax table Using Worksheet 1-2, Figuring Your Reduced IRA Deduction for 2013, Tom figures his deductible and nondeductible amounts as shown on Worksheet 1-2. 1040ez tax table Figuring Your Reduced IRA Deduction for 2013—Example 1 Illustrated. 1040ez tax table Betty figures her IRA deduction as follows. 1040ez tax table Betty can treat all or part of her contributions as either deductible or nondeductible. 1040ez tax table This is because her $5,500 contribution for 2013 is not subject to the deduction phaseout discussed earlier under Limit if Covered by Employer Plan . 1040ez tax table She does not need to use Worksheet 1-2, Figuring Your Reduced IRA Deduction for 2013, because their modified AGI is not within the phaseout range that applies. 1040ez tax table Betty decides to treat her $5,500 IRA contributions as deductible. 1040ez tax table The IRA deductions of $5,080 and $5,500 on the joint return for Tom and Betty total $10,580. 1040ez tax table Example 2. 1040ez tax table For 2013, Ed and Sue file a joint return on Form 1040. 1040ez tax table They are both 39 years old. 1040ez tax table Ed is covered by his employer's retirement plan. 1040ez tax table Ed's salary is $45,000. 1040ez tax table Sue had no compensation for the year and did not contribute to an IRA. 1040ez tax table Sue is not covered by an employer plan. 1040ez tax table Ed contributed $5,500 to his traditional IRA and $5,500 to a traditional IRA for Sue (a Kay Bailey Hutchison Spousal IRA). 1040ez tax table Their combined modified AGI, which includes $2,000 interest and dividend income and a large capital gain from the sale of stock, is $180,555. 1040ez tax table Because the combined modified AGI is $115,000 or more, Ed cannot deduct any of the contribution to his traditional IRA. 1040ez tax table He can either leave the $5,500 of nondeductible contributions in his IRA or withdraw them by April 15, 2014. 1040ez tax table Sue figures her IRA deduction as shown on Worksheet 1-2. 1040ez tax table Figuring Your Reduced IRA Deduction for 2013—Example 2 Illustrated. 1040ez tax table Worksheet 1-2. 1040ez tax table Figuring Your Reduced IRA Deduction for 2013 (Use only if you or your spouse is covered by an employer plan and your modified AGI falls between the two amounts shown below for your coverage situation and filing status. 1040ez tax table ) Note. 1040ez tax table If you were married and both you and your spouse contributed to IRAs, figure your deduction and your spouse's deduction separately. 1040ez tax table IF you . 1040ez tax table . 1040ez tax table . 1040ez tax table AND your  filing status is . 1040ez tax table . 1040ez tax table . 1040ez tax table AND your modified AGI is over . 1040ez tax table . 1040ez tax table . 1040ez tax table THEN enter on  line 1 below . 1040ez tax table . 1040ez tax table . 1040ez tax table       are covered by an employer plan single or head of household $59,000 $69,000     married filing jointly or qualifying widow(er) $95,000 $115,000     married filing separately $0 $10,000     are not covered by an employer plan, but your spouse is covered married filing jointly $178,000 $188,000     married filing separately $0 $10,000     1. 1040ez tax table Enter applicable amount from table above 1. 1040ez tax table   2. 1040ez tax table Enter your modified AGI (that of both spouses, if married filing jointly) 2. 1040ez tax table     Note. 1040ez tax table If line 2 is equal to or more than the amount on line 1, stop here. 1040ez tax table  Your IRA contributions are not deductible. 1040ez tax table See Nondeductible Contributions , earlier. 1040ez tax table     3. 1040ez tax table Subtract line 2 from line 1. 1040ez tax table If line 3 is $10,000 or more ($20,000 or more if married filing jointly or qualifying widow(er) and you are covered by an employer plan), stop here. 1040ez tax table You can take a full IRA deduction for contributions of up to $5,500 ($6,500 if you are age 50 or older) or 100% of your (and if married filing jointly, your spouse's) compensation, whichever is less 3. 1040ez tax table   4. 1040ez tax table Multiply line 3 by the percentage below that applies to you. 1040ez tax table If the result is not a multiple of $10, round it to the next highest multiple of $10. 1040ez tax table (For example, $611. 1040ez tax table 40 is rounded to $620. 1040ez tax table ) However, if the result is less than $200, enter $200. 1040ez tax table         Married filing jointly or qualifying widow(er) and you are covered by an employer plan, multiply line 3 by 27. 1040ez tax table 5% (. 1040ez tax table 275) (by 32. 1040ez tax table 5% (. 1040ez tax table 325) if you are age 50 or older). 1040ez tax table All others, multiply line 3 by 55% (. 1040ez tax table 55) (by 65% (. 1040ez tax table 65) if you are age 50 or older). 1040ez tax table 4. 1040ez tax table   5. 1040ez tax table Enter your compensation minus any deductions on Form 1040 or Form 1040NR, line 27 (deductible part of self-employment tax) and line 28 (self-employed SEP, SIMPLE, and qualified plans). 1040ez tax table If you are filing a joint return and your compensation is less than your spouse's, include your spouse's compensation reduced by his or her traditional IRA and Roth IRA contributions for this year. 1040ez tax table If you file Form 1040 or Form 1040NR, do not reduce your compensation by any losses from self-employment 5. 1040ez tax table   6. 1040ez tax table Enter contributions made, or to be made, to your IRA for 2013, but do not enter more than $5,500 ($6,500 if you are age 50 or older). 1040ez tax table If contributions are more than $5,500 ($6,500 if you are age 50 or older), see Excess Contributions , later. 1040ez tax table 6. 1040ez tax table   7. 1040ez tax table IRA deduction. 1040ez tax table Compare lines 4, 5, and 6. 1040ez tax table Enter the smallest amount (or a smaller amount if you choose) here and on the Form 1040, 1040A, or 1040NR line for your IRA, whichever applies. 1040ez tax table If line 6 is more than line 7 and you want to make a nondeductible contribution, go to line 8 7. 1040ez tax table   8. 1040ez tax table Nondeductible contribution. 1040ez tax table Subtract line 7 from line 5 or 6, whichever is smaller. 1040ez tax table  Enter the result here and on line 1 of your Form 8606 8. 1040ez tax table   Worksheet 1-2. 1040ez tax table Figuring Your Reduced IRA Deduction for 2013—Example 1 Illustrated (Use only if you or your spouse is covered by an employer plan and your modified AGI falls between the two amounts shown below for your coverage situation and filing status. 1040ez tax table ) Note. 1040ez tax table If you were married and both you and your spouse contributed to IRAs, figure your deduction and your spouse's deduction separately. 1040ez tax table IF you . 1040ez tax table . 1040ez tax table . 1040ez tax table AND your  filing status is . 1040ez tax table . 1040ez tax table . 1040ez tax table AND your modified AGI is over . 1040ez tax table . 1040ez tax table . 1040ez tax table THEN enter on  line 1 below . 1040ez tax table . 1040ez tax table . 1040ez tax table       are covered by an employer plan single or head of household $59,000 $69,000     married filing jointly or qualifying widow(er) $95,000 $115,000     married filing separately $0 $10,000     are not covered by an employer plan, but your spouse is covered married filing jointly $178,000 $188,000     married filing separately $0 $10,000     1. 1040ez tax table Enter applicable amount from table above 1. 1040ez tax table 115,000 2. 1040ez tax table Enter your modified AGI (that of both spouses, if married filing jointly) 2. 1040ez tax table 96,555   Note. 1040ez tax table If line 2 is equal to or more than the amount on line 1, stop here. 1040ez tax table  Your IRA contributions are not deductible. 1040ez tax table See Nondeductible Contributions , earlier. 1040ez tax table     3. 1040ez tax table Subtract line 2 from line 1. 1040ez tax table If line 3 is $10,000 or more ($20,000 or more if married filing jointly or qualifying widow(er) and you are covered by an employer plan), stop here. 1040ez tax table You can take a full IRA deduction for contributions of up to $5,500 ($6,500 if you are age 50 or older) or 100% of your (and if married filing jointly, your spouse's) compensation, whichever is less 3. 1040ez tax table 18,445 4. 1040ez tax table Multiply line 3 by the percentage below that applies to you. 1040ez tax table If the result is not a multiple of $10, round it to the next highest multiple of $10. 1040ez tax table (For example, $611. 1040ez tax table 40 is rounded to $620. 1040ez tax table ) However, if the result is less than $200, enter $200. 1040ez tax table         Married filing jointly or qualifying widow(er) and you are covered by an employer plan, multiply line 3 by 27. 1040ez tax table 5% (. 1040ez tax table 275) (by 32. 1040ez tax table 5% (. 1040ez tax table 325) if you are age 50 or older). 1040ez tax table All others, multiply line 3 by 55% (. 1040ez tax table 55) (by 65% (. 1040ez tax table 65) if you are age 50 or older). 1040ez tax table 4. 1040ez tax table 5,080 5. 1040ez tax table Enter your compensation minus any deductions on Form 1040 or Form 1040NR, line 27 (deductible part of self-employment tax) and line 28 (self-employed SEP, SIMPLE, and qualified plans). 1040ez tax table If you are filing a joint return and your compensation is less than your spouse's, include your spouse's compensation reduced by his or her traditional IRA and Roth IRA contributions for this year. 1040ez tax table If you file Form 1040 or Form 1040NR, do not reduce your compensation by any losses from self-employment 5. 1040ez tax table 59,000 6. 1040ez tax table Enter contributions made, or to be made, to your IRA for 2013, but do not enter more than $5,500 ($6,500 if you are age 50 or older). 1040ez tax table If contributions are more than $5,500 ($6,500 if you are age 50 or older), see Excess Contributions , later. 1040ez tax table 6. 1040ez tax table 5,500 7. 1040ez tax table IRA deduction. 1040ez tax table Compare lines 4, 5, and 6. 1040ez tax table Enter the smallest amount (or a smaller amount if you choose) here and on the Form 1040, 1040A, or 1040NR line for your IRA, whichever applies. 1040ez tax table If line 6 is more than line 7 and you want to make a nondeductible contribution, go to line 8 7. 1040ez tax table 5,080 8. 1040ez tax table Nondeductible contribution. 1040ez tax table Subtract line 7 from line 5 or 6, whichever is smaller. 1040ez tax table  Enter the result here and on line 1 of your Form 8606 8. 1040ez tax table 420 Worksheet 1-2. 1040ez tax table Figuring Your Reduced IRA Deduction for 2013—Example 2 Illustrated (Use only if you or your spouse is covered by an employer plan and your modified AGI falls between the two amounts shown below for your coverage situation and filing status. 1040ez tax table ) Note. 1040ez tax table If you were married and both you and your spouse contributed to IRAs, figure your deduction and your spouse's deduction separately. 1040ez tax table IF you . 1040ez tax table . 1040ez tax table . 1040ez tax table AND your  filing status is . 1040ez tax table . 1040ez tax table . 1040ez tax table AND your modified AGI is over . 1040ez tax table . 1040ez tax table . 1040ez tax table THEN enter on  line 1 below . 1040ez tax table . 1040ez tax table . 1040ez tax table       are covered by an employer plan single or head of household $59,000 $69,000     married filing jointly or qualifying widow(er) $95,000 $115,000     married filing separately $0 $10,000     are not covered by an employer plan, but your spouse is covered married filing jointly $178,000 $188,000     married filing separately $0 $10,000     1. 1040ez tax table Enter applicable amount from table above 1. 1040ez tax table 188,000 2. 1040ez tax table Enter your modified AGI (that of both spouses, if married filing jointly) 2. 1040ez tax table 180,555   Note. 1040ez tax table If line 2 is equal to or more than the amount on line 1, stop here. 1040ez tax table  Your IRA contributions are not deductible. 1040ez tax table See Nondeductible Contributions , earlier. 1040ez tax table     3. 1040ez tax table Subtract line 2 from line 1. 1040ez tax table If line 3 is $10,000 or more ($20,000 or more if married filing jointly or qualifying widow(er) and you are covered by an employer plan), stop here. 1040ez tax table You can take a full IRA deduction for contributions of up to $5,500 ($6,500 if you are age 50 or older) or 100% of your (and if married filing jointly, your spouse's) compensation, whichever is less 3. 1040ez tax table 7,445 4. 1040ez tax table Multiply line 3 by the percentage below that applies to you. 1040ez tax table If the result is not a multiple of $10, round it to the next highest multiple of $10. 1040ez tax table (For example, $611. 1040ez tax table 40 is rounded to $620. 1040ez tax table ) However, if the result is less than $200, enter $200. 1040ez tax table         Married filing jointly or qualifying widow(er) and you are covered by an employer plan, multiply line 3 by 27. 1040ez tax table 5% (. 1040ez tax table 275) (by 32. 1040ez tax table 5% (. 1040ez tax table 325) if you are age 50 or older). 1040ez tax table All others, multiply line 3 by 55% (. 1040ez tax table 55) (by 65% (. 1040ez tax table 65) if you are age 50 or older). 1040ez tax table 4. 1040ez tax table 4,100 5. 1040ez tax table Enter your compensation minus any deductions on Form 1040 or Form 1040NR, line 27 (deductible part of self-employment tax) and line 28 (self-employed SEP, SIMPLE, and qualified plans). 1040ez tax table If you are filing a joint return and your compensation is less than your spouse's, include your spouse's compensation reduced by his or her traditional IRA and Roth IRA contributions for this year. 1040ez tax table If you file Form 1040 or Form 1040NR, do not reduce your compensation by any losses from self-employment 5. 1040ez tax table 39,500 6. 1040ez tax table Enter contributions made, or to be made, to your IRA for 2013, but do not enter more than $5,500 ($6,500 if you are age 50 or older). 1040ez tax table If contributions are more than $5,500 ($6,500 if you are age 50 or older), see Excess Contributions , later. 1040ez tax table 6. 1040ez tax table 5,500 7. 1040ez tax table IRA deduction. 1040ez tax table Compare lines 4, 5, and 6. 1040ez tax table Enter the smallest amount (or a smaller amount if you choose) here and on the Form 1040, 1040A, or 1040NR line for your IRA, whichever applies. 1040ez tax table If line 6 is more than line 7 and you want to make a nondeductible contribution, go to line 8 7. 1040ez tax table 4,100 8. 1040ez tax table Nondeductible contribution. 1040ez tax table Subtract line 7 from line 5 or 6, whichever is smaller. 1040ez tax table  Enter the result here and on line 1 of your Form 8606 8. 1040ez tax table 1,400 What if You Inherit an IRA? If you inherit a traditional IRA, you are called a beneficiary. 1040ez tax table A beneficiary can be any person or entity the owner chooses to receive the benefits of the IRA after he or she dies. 1040ez tax table Beneficiaries of a traditional IRA must include in their gross income any taxable distributions they receive. 1040ez tax table Inherited from spouse. 1040ez tax table   If you inherit a traditional IRA from your spouse, you generally have the following three choices. 1040ez tax table You can: Treat it as your own IRA by designating yourself as the account owner. 1040ez tax table Treat it as your own by rolling it over into your IRA, or to the extent it is taxable, into a: Qualified employer plan, Qualified employee annuity plan (section 403(a) plan), Tax-sheltered annuity plan (s