I Have a Retirement Plan at Work. Can I Also Have a Self Directed IRA?
The simple answer, yes. However, if we dig a little deeper, we will find that there are limitations on contributions and deductions.
There are two questions we need to address:
1. I have a retirement plan (401k, 403b, 457, TSP) at work. Can I also own a Self Directed IRA?
YES! Whether it is a start up account, an IRA you’ve had for a while, or an inherited IRA you received from someone else. In any case, YES, you may have more than one tax-preferred retirement account at the same time.
2. I have a retirement plan at work. Can I also contribute to a Self Directed IRA?
YES! Please be aware of the limitations set by the IRS.
If You Are Already Covered by a Retirement Plan at Work
| Plan Type | 2020 Limit |
| IRA | $6,000
Over 50 Additional Catch-Up: $1,000 |
| 401(k) | $19,500
Over 50 Additional Catch-Up: $6,500 |
| 403(b) | $19,500
Over 50 Additional Catch-Up: $6,500 |
| 457 | $19,500
Over 50 Additional Catch-Up: $6,500 |
Claiming a tax deduction for your IRA contributions
Your traditional IRA contributions may be tax-deductible. The deduction may be limited if you or your spouse is covered by a retirement plan at work and your income exceeds certain levels.
| Filing Status | Modified AGI | Deduction |
| single or head of household | $65,000 or less | a full deduction up to the amount of your contribution limit |
| more than $65,000 but less than $75,000 | a partial deduction | |
|
$75,000 or more |
no deduction | |
| married filing jointly or qualifying widow(er) | $104,000 or less | a full deduction up to the amount of your contribution limit |
| more than $104,000 but less than $124,000 | a partial deduction | |
| $124,000 or more | no deduction | |
| married filing separately | less than $10,000 | a partial deduction |
| $10,000 or more | no deduction |
If you are married and file a joint income tax return or you are a qualifying widow(er).
- You may contribute to your IRA up to the maximum allowable limit if your AGI is $103,000 or less.
- You may contribute to your IRA a reduced amount if your AGI is over $103,000, but less than $123,000.
- You may not contribute to your IRA if your AGI is over $123,000.
If you are filing your income taxes as single or head of household.
- You may contribute to your IRA up to the maximum allowable limit if your AGI is $64,000 or less.
- You may contribute to your IRA a reduced amount if your AGI is over $64,000, but less than $74,000.
- You may not contribute to your IRA if your AGI is over $74,000.
For information about the Self Directed IRA or Solo 401k, call IRA Club at 312-795-0988
Be advised that IRA Club does not evaluate, review, monitor, recommend, warrant, guarantee or otherwise endorse the legality, tax treatment, propriety, performance or reliability of any investment, service, statement, opinion or other representation provided with respect to the investment opportunities listed on its site or their sponsors or providers. IRA Club has no financial arrangement, partnership, joint venture, or other affiliation with the sponsors or providers of these investments. IRA Club shall not be liable for any misinformation, misrepresentation, negligence, act, omission, investment results or any wrongdoing with respect to any of these investments or their sponsors or providers.
