What are IRA phaseout rules for 2010?
Per the IRS, for the tax year 2010, if a taxpayer is covered by a retirement plan at work, that taxpayers deduction for contributions to a traditional IRA is reduced or phased out if that taxpayers Modified Adjusted Gross Income is;
1. More than $80,000 but less than $109,000 for a married couple filing a joint tax return or for a qualifying widow(er).
2. More than $56,000 but less than $66,000 for a Single Individual or Head of Household.
3. Less than $10,000 for a married individual filing a separate return.
Furthermore, if taxpayer lives with his or her spouse or file a joint tax return and their spouse is covered by a retirement plan at work, but the taxpayer is not, the taxpayers deduction is phased out if their modified adjusted gross income is greater than $167,000 but less than $177,000.
For a joint filing taxpayer's whose Modified Adjusted Gross Income is greater than $177,000, the taxpayer cannot take a IRA deduction in 2010!