05 Mar Can I fund an IRA to qualify for the pension exclusion?
Q. If my wife and I earned $102,000 in New Jersey, can we do an IRA for $2,000 to get us under the $100,000 income amount to qualify for the pension exclusion?
— Trying to save
A. Nice try, but that’s not going to work.
It seems you are clearly aware of the fact that in order for you to claim a New Jersey pension exclusion, your gross income cannot exceed $100,000.
New Jersey does not allow any deduction for an IRA contribution, he said, noting the only retirement plan that New Jersey allows a deduction for is a 401(k) plan.
“So if your total gross income is $102,000 including some retirement plan distribution income, you will not be entitled to any pension exclusion,” Becourtney said.
Email your questions to .
This story was originally published on March 5, 2021.
NJMoneyHelp.com presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.