Traditional IRA Contributions for 2024 with Form 8606

Taxpayers can generally contribute money to their Traditional IRA and receive a tax deduction for the amounts they contribute to the account. However, the deduction may be limited depending on the taxpayer's income and whether they are covered by a retirement plan at work.

The maximum amount of IRA contributions for 2024 is $7,000. If the taxpayer is age 50 or older, the maximum contribution amount is $8,000.

In this example, the taxpayer has a 401(k) plan with their employer, and they make a Traditional IRA contribution during 2024. The deductible amount is limited, so they must complete Form 8606 and include it in Form 1040.

IRS Guidance:
https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-ira-contribution-limits

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