Question

Traditional IRA Deductions and Private Pensions

Forum|Forum|5 years ago
May 14, 2021
1 reply
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I live and work abroad. My foreign employer provides a private pension system that is not in any way a "qualified" pension plan as my employer knows nothing about these standards. Does this private pension disqualify me from contributing to and deducting a Traditional IRA contribution?

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D

DanaB27

Yes, the private pension from your work will limit your deduction if you are over a certain income limit. Please see IRA deduction limits.

You’re covered by an employer retirement plan for a tax year if your employer (or your spouse’s employer) has a:

Defined contribution plan (profit-sharing, 401(k), stock bonus and money purchase pension plan) and any contributions or forfeitures were allocated to your account for the plan year ending with or within the tax year;
IRA-based plan (SEP, SARSEP or SIMPLE IRA plan) and you had an amount contributed to your IRA for the plan year that ends with or within the tax year; or
Defined benefit plan (pension plan that pays a retirement benefit spelled out in the plan) and you are eligible to participate for the plan year ending with or within the tax year.

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