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Individual Retirement Annuity

Forum|Forum|1 year ago
September 25, 2024
2 replies
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One of my clients contacted me and stated he had a retirement annuity that he makes a monthly payment to. On the paperwork, the Contract Plan Type is Individual Retirement Annuity. He and his wife are retired and not employed and draw a pension and Social Security plus their investment income. Both are over 65. He said his financial advisor said his payment should be tax deductible.

Is anyone familiar with this and can you tell me if it is deductible? If deductible, would it count as an IRA deduction? He is not currently drawing payments from this annuity.

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Best answer by IRonMaN

Google is a good friend to have. Have you done a search for individual retirement annuity?

Level 15

Google is a good friend to have. Have you done a search for individual retirement annuity?

Slava Ukraini!

TP82Author

Level 4

Thanks, I Googled it and from what I am reading, since they don't have any compensation, they are not entitled to a deduction.

Level 15

I'm glad you got it figured out!

Slava Ukraini!

Level 15

Is your client making an excess contribution to an IRA? https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-ira-contribution-limits#:~:text=Excess%20contributions%20are%20taxed%20at,end%20of%20the%20tax%20year.

Have the financial advisor give them the bad news and maybe even do the tax return?

Answers are easy. Questions are hard!

TP82Author

Level 4

I sent him that way! Thanks.