Limits on Deducting IRA Contributions If You Are Married and Filing Jointly

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Limits on Deducting IRA Contributions If You Are Married and Filing Jointly

For married couples who file their taxes jointly, limits on deducting IRA contributions depend on (in addition to income) whether the IRA holder is covered by an employee retirement plan.

If covered by an employer plan

For a couple who files a joint tax return and for whom the contributor is also covered by an employer plan, there is a phase-out that begins at a modified adjusted gross income (MAGI) of $126,000 in 2025. As income within this range rises, the deductibility of contributions falls, so that at $20,000 above the phase-out point, deductibility falls to $0. Thus, for example, a married couple filing jointly and with a MAGI over $146,000 in 2025 will not be able to deduct anything at all.

If one spouse is not covered by an employer plan

If just one spouse is covered by an employer plan, that spouse is subject to the rule above. The spouse not covered has a phase-out point beginning at $236,000 of joint MAGI. Deductibility is reduced as MAGI rises. At $246,000, deductibility drops to $0.

IRS Publication 590a provides worksheets to help you with your calculations.

Because the income growth that an IRA makes is tax-deferred, financial advisors often suggest putting as much as legally possible into your IRA, no matter how much you are allowed to deduct from your taxable income. The extent of deductibility does not affect the tax-deferred status of your IRAs earnings.