Taxpayer Eligibility for IRAs

Publication Date: March 2008

Publisher: Tax Policy Center

Author(s): Benjamin H. Harris; Christopher Geissler

Research Area: Banking and finance

Keywords: Elderly; Retirement/Pensions; Tax Policy; Tax Distribution and Economic Trends

Type: Report

Abstract:

The tax code limits the extent to which individuals may take advantage of the tax benefits associated with traditional and Roth IRAs. The only eligibility criteria for contributing to a Roth IRA are income and filing status. In contrast, eligibility for deducting contributions to a traditional IRA depends on those factors as well as on whether the taxpayer and the taxpayer?s spouse participate in an employer-provided pension. Taxpayers are subject to an assortment of phaseout ranges based on those criteria.