Future Developments . . . . . . . . . . . . . . . . . . . . . . . 1

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Contents

Future Developments . . . . . . . . . . . . . . . . . . . . . . . 1

Publication 590-A

What’s New for 2025 . . . . . . . . . . . . . . . . . . . . . . . . 1

Contributions

to Individual

Retirement

Arrangements

(IRAs)

What’s New for 2026 . . . . . . . . . . . . . . . . . . . . . . . . 2

For use in preparing

2025 Returns

Reminders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Chapter 1. Traditional IRAs . . . . . . . . . . . . . . . . . . 6

Who Can Open a Traditional IRA? . . . . . . . . . . . . 6

When Can a Traditional IRA Be Opened? . . . . . . . 7

How Can a Traditional IRA Be Opened? . . . . . . . . 7

How Much Can Be Contributed? . . . . . . . . . . . . . 9

When Can Contributions Be Made? . . . . . . . . . . 10

How Much Can You Deduct? . . . . . . . . . . . . . . . 11

What if You Inherit an IRA? . . . . . . . . . . . . . . . . 21

Can You Move Retirement Plan Assets? . . . . . . . 21

When Can You Withdraw or Use Assets? . . . . . . 31

What Acts Result in Penalties or Additional

Taxes? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

Chapter 2. Roth IRAs . . . . . . . . . . . . . . . . . . . . . 38

What Is a Roth IRA? . . . . . . . . . . . . . . . . . . . . . 39

When Can a Roth IRA Be Opened? . . . . . . . . . . 39

Can You Contribute to a Roth IRA? . . . . . . . . . . . 39

Can You Move Amounts Into a Roth IRA? . . . . . . 44

Chapter 3. Retirement Savings Contributions

Credit (Saver's Credit) . . . . . . . . . . . . . . . . . . 46

How To Get Tax Help . . . . . . . . . . . . . . . . . . . . . . . 48

Appendices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52

Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60

Future Developments

For the latest information about developments related to

Pub. 590-A, such as legislation enacted after it was

published, go to IRS.gov/Pub590A.

What’s New for 2025

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Jan 15, 2026

IRA contribution limit for 2025. For 2025, the IRA contribution limit remains $7,000 ($8,000 for individuals age

50 or older).

Trump account and new Form 4547. Recent legislation

allows parents, guardians, and other authorized individuals to elect to establish a new type of individual retirement

account, called a Trump account, for the exclusive benefit

of certain children. If the child was born after 2024 and before 2029, is a U.S. citizen, and meets certain other requirements, the authorized individual may also elect to receive a $1,000 pilot program contribution to the child’s

Trump account. Both elections can be made on Form

Publication 590-A (2025) Catalog Number 66302J

Department of the Treasury Internal Revenue Service www.irs.gov

4547, which can be filed at the same time as the authorized individual’s 2025 income tax return. For more information on Trump accounts, and to learn how to make

these elections, see Form 4547 and its instructions.

Modified AGI limit for traditional IRA contributions.

For 2025, if you are covered by a retirement plan at work,

your deduction for contributions to a traditional IRA is reduced (phased out) if your modified AGI is:

• More than $126,000 but less than $146,000 for a married couple filing a joint return or a qualifying surviving

spouse,

• More than $79,000 but less than $89,000 for a single

individual or head of household, or

• Less than $10,000 for a married individual filing a separate return.

Modified AGI limit for certain married individuals.

If you are married and your spouse is covered by a retirement plan at work and you aren’t, and you live with your

spouse or file a joint return, your deduction is phased out if

your modified AGI is more than $236,000 (up from

$230,000 for 2024) but less than $246,000 (up from

$240,000 for 2024). If your modified AGI is $246,000 or

more, you can’t take a deduction for contributions to a traditional IRA.

Modified AGI limit for Roth IRA contributions. For

2025, your Roth IRA contribution limit is reduced (phased

out) in the following situations.

• Your filing status is married filing jointly or qualifying

surviving spouse and your modified AGI is at least

$236,000. You can’t make a Roth IRA contribution if

your modified AGI is $246,000 or more.

• Your filing status is single, head of household, or mar-

ried filing separately and you didn’t live with your

spouse at any time in 2025 and your modified AGI is at

least $150,000. You can’t make a Roth IRA contribution if your modified AGI is $165,000 or more.

• Your filing status is married filing separately, you lived

with your spouse at any time during the year, and your

modified AGI is more than zero. You can’t make a Roth

IRA contribution if your modified AGI is $10,000 or

more.

What’s New for 2026

IRA contribution limit increased for 2026. Beginning

in 2026, the IRA contribution limit is increased to $7,500

($8,600 for individuals age 50 or older) from $7,000

($8,000 for individuals age 50 or older).

Modified AGI limit for traditional IRA contributions increased. For 2026, if you are covered by a retirement

plan at work, your deduction for contributions to a traditional IRA is reduced (phased out) if your modified AGI is:

• More than $129,000 but less than $149,000 for a married couple filing a joint return or a qualifying surviving

spouse,

• More than $81,000 but less than $91,000 for a single

individual or head of household, or

• Less than $10,000 for a married individual filing a separate return.

Modified AGI limit for certain married individuals

increased. If you are married and your spouse is covered

by a retirement plan at work and you aren’t, and you live

with your spouse or file a joint return, your deduction is

phased out if your modified AGI is more than $242,000

(up from $236,000 for 2025) but less than $252,000 (up

from $246,000 for 2025). If your modified AGI is $252,000

or more, you can’t take a deduction for contributions to a

traditional IRA.

Modified AGI limit for Roth IRA contributions increased. For 2026, your Roth IRA contribution limit is reduced (phased out) in the following situations.

• Your filing status is married filing jointly or qualifying

surviving spouse and your modified AGI is at least

$242,000. You can’t make a Roth IRA contribution if

your modified AGI is $252,0000 or more.

• Your filing status is single, head of household, or mar-

ried filing separately and you didn’t live with your

spouse at any time in 2026 and your modified AGI is at

least $153,000. You can’t make a Roth IRA contribution if your modified AGI is $168,000 or more.

• Your filing status is married filing separately, you lived

with your spouse at any time during the year, and your

modified AGI is more than zero. You can’t make a Roth

IRA contribution if your modified AGI is $10,000 or

more.

Reminders

Qualified tuition program rollover to a Roth IRA. Beginning with distributions made after December 31, 2023,

a beneficiary of a section 529 qualified tuition program is

permitted to roll over a distribution from a section 529 account into a Roth IRA for the beneficiary if certain requirements are met. See Qualified tuition program rollover to a

Roth IRA, later.

Increase in required minimum distribution age. Individuals who reach age 72 after December 31, 2022, may

delay receiving their required minimum distributions

(RMDs) until April 1 of the year following the year in which

they turn age 73.

Qualified disaster tax relief. The special rules that provide for tax-favored withdrawals and repayments from certain qualified plans for taxpayers who suffered an economic loss as a result of a qualified disaster were made

permanent by the SECURE 2.0 Act of 2022.

A qualified disaster is a major disaster that occurred on

or after January 26, 2021, and was declared by the President after December 27, 2020, under section 401 of the

Robert T. Stafford Disaster Relief and Emergency Act. For

more information, see Disaster-Related Relief in Pub.

590-B,

Distributions

from

Individual

Retirement

Arrangements (IRAs).

Publication 590-A (2025)

Repayment of certain early distributions. Contributions made to the eligible retirement plan as a repayment

of emergency personal expense distributions, domestic

abuse distributions, and terminal illness distributions may

be eligible for tax-free rollover treatment. See Pub. 590-B

for more information.

Certain corrective distributions not subject to 10%

additional tax. Beginning on December 29, 2022, the

10% additional tax on early distributions will not apply to a

corrective IRA distribution, which consists of an excess

contribution (a contribution greater than the IRA contribution limit) and any earnings allocable to the excess contribution, as long as the corrective distribution is made on or

before the due date (including extensions) of the income

tax return.

Divorce or separation instruments after 2018.

Amounts paid as alimony or separate maintenance payments under a divorce or separation instrument executed

after 2018 won't be deductible by the payer. Such

amounts also won't be includible in the income of the recipient. The same is true of alimony paid under a divorce

or separation instrument executed before 2019 and modified after 2018, if the modification expressly states that the

alimony isn't deductible to the payer or includible in the income of the recipient. For more information, see Pub. 504.

IRA interest. Although interest earned from your IRA is

generally not taxed in the year earned, it isn’t tax-exempt

interest. Tax on your traditional IRA is generally deferred

until you take a distribution. Don’t report this interest on

your return as tax-exempt interest. For more information

on tax-exempt interest, see the instructions for your tax return.

Photographs of missing children. The IRS is a proud

partner with the National Center for Missing & Exploited

Children® (NCMEC). Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring

these children home by looking at the photographs and

calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.

Introduction

This publication discusses contributions to individual retirement arrangements (IRAs). An IRA is a personal savings plan that gives you tax advantages for setting aside

money for retirement. For information about distributions

(including rollovers) from an IRA, see Pub. 590-B.

What are some tax advantages of an IRA? Two tax advantages of an IRA are that:

• Contributions you make to an IRA may be fully or partially deductible, depending on which type of IRA you

have and on your circumstances; and

• Generally, amounts in your IRA (including earnings

and gains) aren’t taxed until distributed. In some cases, amounts aren’t taxed at all if distributed according

to the rules.

Publication 590-A (2025)

What's in this publication? This publication discusses

contributions to traditional and Roth IRAs. It explains the

rules for:

• Setting up an IRA,

• Contributing to an IRA,

• Transferring money or property to and from an IRA,

and

• Taking a credit for contributions to an IRA.

It also explains the penalties and additional taxes that

apply when the rules aren’t followed. To assist you in complying with the tax rules for IRAs, this publication contains

worksheets and sample forms, which can be found

throughout the publication and in the appendices at the

end of the publication.

How to use this publication. The rules that you must

follow depend on which type of IRA you have. Use Table

I-1 to help you determine which parts of this publication to

read. Also use Table I-1 if you were referred to this publication from instructions to a form.

Comments and suggestions. We welcome your comments about this publication and suggestions for future

editions.

You can send us comments through IRS.gov/

FormComments. Or, you can write to the Internal Revenue

Service, Tax Forms and Publications, 1111 Constitution

Ave. NW, IR-6526, Washington, DC 20224.

Although we can’t respond individually to each comment received, we do appreciate your feedback and will

consider your comments and suggestions as we revise

our tax forms, instructions, and publications. Don’t send

tax questions, tax returns, or payments to the above address.

Getting answers to your tax questions. If you have

a tax question not answered by this publication or the How

To Get Tax Help section at the end of this publication, go

to the IRS Interactive Tax Assistant page at IRS.gov/

Help/ITA where you can find topics by using the search

feature or viewing the categories listed.

Getting tax forms, instructions, and publications.

Go to IRS.gov/Forms to download current and prior-year

forms, instructions, and publications.

Ordering tax forms, instructions, and publications.

Go to IRS.gov/OrderForms to order current forms, instructions, and publications; call 800-829-3676 to order

prior-year forms and instructions. The IRS will process

your order for forms and publications as soon as possible.

Don’t resubmit requests you’ve already sent us. You can

get forms and publications faster online.

Useful Items

You may want to see:

Publications

505 Tax Withholding and Estimated Tax

505

590-B Distributions from Individual Retirement

Arrangements (IRAs)

560 Retirement Plans for Small Business (SEP,

SIMPLE, and Qualified Plans)

571 Tax-Sheltered Annuity Plans (403(b) Plans)

575 Pension and Annuity Income

939 General Rule for Pensions and Annuities

590-B

5305-SIMPLE Savings Incentive Match Plan for

Employees of Small Employers (SIMPLE)—for

Use With a Designated Financial Institution

5305-SIMPLE

560

571

575

5329 Additional Taxes on Qualified Plans (Including

IRAs) and Other Tax-Favored Accounts

5329

5498 IRA Contribution Information

5498

939

Forms (and Instructions)

W-4P Withholding Certificate for Pension or Annuity

Payments

1099-R Distributions From Pensions, Annuities,

Retirement or Profit-Sharing Plans, IRAs,

Insurance Contracts, etc.

5304-SIMPLE Savings Incentive Match Plan for

Employees of Small Employers (SIMPLE)—Not

for Use With a Designated Financial Institution

5305-S SIMPLE Individual Retirement Trust Account

5305-SA SIMPLE Individual Retirement Custodial

Account

W-4P

1099-R

5304-SIMPLE

8606 Nondeductible IRAs

8606

8815 Exclusion of Interest From Series EE and I U.S.

Savings Bonds Issued After 1989

8815

8839 Qualified Adoption Expenses

8839

8880 Credit for Qualified Retirement Savings

Contributions

8880

8915-F Qualified Disaster Retirement Plan

Distributions and Repayments

8915-F

5305-S

5305-SA

See How To Get Tax Help near the end of this publication

for information about getting these publications and forms.

Table I-1. Using This Publication

IF you need information on...

THEN see...

traditional IRAs (not including traditional SIMPLE IRAs)

chapter 1.

Roth IRAs (not including Roth SIMPLE IRAs)

chapter 2, and parts of

chapter 1.

the credit for qualified retirement savings contributions

(saver's credit)

chapter 3.

how to keep a record of your contributions to, and

distributions from, your traditional IRA(s)

Appendix A.

SEP IRAs, SIMPLE IRAs, and 401(k) plans

Pub. 560.

Coverdell education savings accounts (ESAs) (formerly

called education IRAs)

Pub. 970.

IF for 2025, you:

• received social security benefits,

• had taxable compensation,

• contributed to a traditional IRA, and

• you or your spouse was covered by an employer

retirement plan,

and you want to...

THEN see...

first figure your modified adjusted gross income (AGI)

Appendix B, Worksheet 1.

then figure how much of your traditional IRA contribution

you can deduct

Appendix B, Worksheet 2.

and finally figure how much of your social security is

taxable

Appendix B, Worksheet 3.

Publication 590-A (2025)

Table I-2. How Are a Traditional IRA and a Roth IRA Different?

This table shows the differences between traditional IRAs (not including traditional SIMPLE IRAs) and Roth IRAs (not

including Roth SIMPLE IRAs). Answers in the middle column apply to traditional IRAs. Answers in the right column apply

to Roth IRAs.

Question

Answer

Traditional IRA?

Roth IRA?

Is there an age limit on when I can open

and contribute to a . . . . . . . . . . . . . . . .

No. For tax years after 2019, you are

able to contribute to your IRA even if

you have reached age 701/2 or older.

See Who Can Open a Traditional IRA?

in chapter 1.

No. You can be any age. See Can You

Contribute to a Roth IRA? in chapter 2.

If I earned more than $7,000 in 2025

($8,000 if I was age 50 or older by the

end of 2025), is there a limit on how

much I can contribute to a . . . . . . . . . . .

Yes. For 2025, you can contribute to a

traditional IRA up to:

• $7,000, or

• $8,000 if you were age 50 or older

by the end of 2025.

There is no upper limit on how much

you can earn and still contribute. See

How Much Can Be Contributed? in

chapter 1.

Yes. For 2025, you may be able to

contribute to a Roth IRA up to:

• $7,000, or

• $8,000 if you were age 50 or older

by the end of 2025,

but the amount you can contribute may

be less than that depending on your

income, your filing status, and if you

contribute to another IRA. See How

Much Can Be Contributed? and Table

2-1 in chapter 2.

Can I deduct contributions to a . . . . . . .

Yes. You may be able to deduct your

contributions to a traditional IRA

depending on your income, your filing

status, whether you are covered by a

retirement plan at work, and whether

you receive social security benefits.

See How Much Can You Deduct? in

chapter 1.

No. You can never deduct contributions

to a Roth IRA. See What Is a Roth IRA?

in chapter 2.

Do I have to file a form just because I

contribute to a . . . . . . . . . . . . . . . . . . . .

Not unless you make nondeductible

contributions to your traditional IRA. In

that case, you must file Form 8606. See

Nondeductible Contributions in

chapter 1.

No. You don’t have to file a form if you

contribute to a Roth IRA. See

Contributions not reported in chapter 2.

Publication 590-A (2025)

Roth IRAs are discussed in chapter 2. SIMPLE IRAs

are discussed in Pub. 560. For a traditional IRA that receives employer contributions from a SEP arrangement,

see Simplified Employee Pension (SEP), later.

Traditional IRAs

Who Can Open a Traditional

IRA?

Reminders

Types of IRAs. An IRA can be either a traditional IRA or

a Roth IRA. In general, individuals may make their own

contributions to their traditional IRAs or Roth IRAs. In addition, certain employers have arrangements under which

the employer may contribute to IRAs of their employees.

Under a SEP arrangement, an employer contributes to

traditional IRAs (sometimes referred to as traditional SEP

IRAs) or Roth IRAs (sometimes referred to as Roth SEP

IRAs) of its employees. Individuals may separately make

their own contributions to the same IRAs to which their

employer contributes under a SEP arrangement.

Under a SIMPLE IRA plan, an employer contributes

salary reduction contributions (at the election of the employee), matching contributions and/or nonelective contributions to traditional IRAs (sometimes referred to as traditional SIMPLE IRAs) or Roth IRAs (sometimes referred to

as Roth SIMPLE IRAs) of its employees. However, a SIMPLE IRA (whether a traditional SIMPLE IRA or a Roth

SIMPLE IRA) is subject to certain restrictions that do not

generally apply to other traditional IRAs or Roth IRAs. For

example, an individual cannot make their own contributions to a SIMPLE IRA. In addition, there are various restrictions related to distributions and contributions during

the initial 2 years of participation in the SIMPLE IRA plan.

References in this publication to traditional IRAs generally include traditional SEP IRAs but do not include traditional SIMPLE IRAs, unless otherwise stated. Likewise,

references to Roth IRAs generally include Roth SEP IRAs

but do not include Roth SIMPLE IRAs, unless otherwise

stated.

Introduction

This chapter discusses the original IRA. In this publication, the original IRA (sometimes called an ordinary or regular IRA) is referred to as a “traditional IRA.” For purposes

of this publication, a traditional IRA is any IRA that isn’t a

Roth IRA or a SIMPLE IRA. Traditional IRAs include traditional IRAs that receive employer contributions from SEP

arrangements. The following are two advantages of a traditional IRA.

• You may be able to deduct some or all of your contributions to it, depending on your circumstances.

• Generally, amounts in your IRA, including earnings

and gains, aren’t taxed until they are distributed.

You can open and make contributions to a traditional IRA if

you (or, if you file a joint return, your spouse) received taxable compensation during the year.

You can have a traditional IRA whether or not you are

covered by any other retirement plan. However, you may

not be able to deduct all of your contributions if you or your

spouse is covered by an employer retirement plan. See

How Much Can You Deduct, later.

For tax years beginning after December 31, 2019,

TIP the rule that you are not able to make contribu-

tions to your traditional IRA for the year in which

you reach age 70½ and all later years has been repealed.

Both spouses have compensation. If both you and

your spouse have compensation, each of you can open an

IRA. You can’t both participate in the same IRA. If you file

a joint return, only one of you needs to have compensation.

What Is Compensation?

Generally, compensation is what you earn from working.

For a summary of what compensation does and doesn’t

include, see Table 1-1. Compensation includes all of the

items discussed next (even if you have more than one

type).

Wages, salaries, etc. Wages, salaries, tips, professional

fees, bonuses, and other amounts you receive for providing personal services are compensation. The IRS treats

as compensation any amount properly shown in box 1

(Wages, tips, other compensation) of Form W-2, Wage

and Tax Statement, provided that amount is reduced by

any amount properly shown in box 11 (Nonqualified

plans). A scholarship or fellowship is generally taxable

compensation only if it is in box 1 of your Form W-2. However, for tax years beginning after 2019, certain non-tuition

fellowship and stipend payments not reported to you on

Form W-2 are treated as taxable compensation for IRA

purposes. These amounts include taxable non-tuition fellowship and stipend payments made to aid you in the pursuit of graduate or postdoctoral study and included in your

gross income under the rules discussed in chapter 1 of

Pub. 970, Tax Benefits for Education.

Commissions. An amount you receive that is a percentage of profits or sales price is compensation.

Self-employment income. If you are self-employed (a

sole proprietor or a partner), compensation is the net

Chapter 1

Traditional IRAs

Publication 590-A (2025)

earnings from your trade or business (provided your personal services are a material income-producing factor) reduced by the total of:

What Isn’t Compensation?

Compensation doesn’t include any of the following items.

• The deduction for contributions made on your behalf

• Earnings and profits from property, such as rental in-

• The deduction allowed for the deductible part of your

• Pension or annuity income.

• Deferred compensation received (compensation pay-

to retirement plans, and

self-employment taxes.

Compensation includes earnings from self-employment

even if they aren’t subject to self-employment tax because

of your religious beliefs.

come, interest income, and dividend income.

ments postponed from a past year).

• Income from a partnership for which you don’t provide

services that are a material income-producing factor.

Self-employment loss. If you have a net loss from

self-employment, don’t subtract the loss from your salaries

or wages when figuring your total compensation.

• Conservation Reserve Program (CRP) payments re-

Alimony and separate maintenance. For IRA purposes, compensation includes any taxable alimony and separate maintenance payments you receive under a decree

of divorce or separate maintenance but only with respect

to divorce or separation instruments executed on or before

December 31, 2018, that have not been modified to exclude such amounts.

from income, such as foreign earned income and

housing costs.

ported on Schedule SE (Form 1040), line 1b.

• Any amounts (other than combat pay) you exclude

When Can a Traditional IRA Be

Opened?

Nontaxable combat pay. If you were a member of the

U.S. Armed Forces, compensation includes any nontaxable combat pay you received. This amount should be reported in box 12 of your 2025 Form W-2 with code Q.

You can open a traditional IRA at any time. However, the

time for making contributions for any year is limited. See

When Can Contributions Be Made, later.

Graduate or postdoctoral study. A scholarship or fellowship is generally taxable compensation only if it is in

box 1 of your Form W-2. However, for tax years beginning

after 2019, certain non-tuition fellowship and stipend payments not reported to you on Form W-2 are treated as taxable compensation for IRA purposes. These amounts include taxable non-tuition fellowship and stipend payments

made to aid you in the pursuit of graduate or postdoctoral

study and included in your gross income under the rules

discussed in chapter 1 of Pub. 970.

How Can a Traditional IRA Be

Opened?

Table 1-1. Compensation for Purposes

of an IRA

Includes...

wages, salaries, etc.

commissions.

self-employment income.

taxable alimony and separate

maintenance.

nontaxable combat pay.

Doesn’t include...

earnings and profits from

property.

interest and

dividend income.

Kinds of traditional IRAs. Your traditional IRA can be an

individual retirement account or annuity. It can be an employer or employee association trust account. A traditional

IRA can also be used to accept employer contributions

under a SEP arrangement (sometimes referred to as a traditional SEP IRA).

Individual Retirement Account

pension or annuity

income.

deferred compensation.

income from certain

partnerships.

An individual retirement account is a trust or custodial account set up in the United States for the exclusive benefit

of you or your beneficiaries. The account is created by a

written document. The document must show that the account meets all of the following requirements.

• The trustee or custodian must be a bank, a federally

any amounts you exclude

from income.

insured credit union, a savings and loan association,

or an entity approved by the IRS to act as trustee or

custodian.

• The trustee or custodian generally can’t accept contri-

taxable non-tuition fellowship and

stipend payments.

Publication 590-A (2025)

You can open different kinds of IRAs with a variety of organizations. You can open an IRA at a bank or other financial institution or with a mutual fund or life insurance company. You can also open an IRA through your stockbroker.

Any IRA must meet Internal Revenue Code requirements.

The requirements for the various arrangements are discussed below.

butions of more than the deductible amount for the

Chapter 1

Traditional IRAs

year. However, rollover contributions and employer

contributions to a traditional SEP IRA can be more

than this amount.

• Contributions, except for rollover contributions, must

be in cash. See Rollovers, later.

• You must have a nonforfeitable right to the amount at

all times.

• Money in your account can’t be used to buy a life insurance policy.

• You can’t transfer the bonds.

If you cash (redeem) the bonds before the year in which

you reach age 591/2, you may be subject to a 10% additional tax. See Pub. 590-B for more information about the

age 591/2 rule for early distributions and other distribution

rules. You can roll over redemption proceeds into IRAs.

SIMPLE IRA Plans and SIMPLE IRAs

Individual Retirement Annuity

A SIMPLE IRA plan is a tax-favored retirement plan that

certain small employers (including self-employed employees) can set up for the benefit of their employees. Contributions to the employees’ SIMPLE IRA are made by the

employers and are made up of salary reduction contributions and employer contributions which are either matching contributions or nonelective contributions. A SIMPLE

IRA can be either a traditional SIMPLE IRA or a Roth SIMPLE IRA but are subject to different rules than traditional

or Roth IRAs. See Pub. 560 for more information about

SIMPLE IRA plans and SIMPLE IRAs.

You can open an individual retirement annuity by purchasing an annuity contract or an endowment contract from a

life insurance company.

Simplified Employee Pension (SEP)

Arrangements and SIMPLE IRAs

• Assets in your account can’t be combined with other

property, except in a common trust fund or common

investment fund.

• You must start receiving distributions by April 1 of the

year following the year in which you reach age 73. See

Pub. 590-B for more information about RMDs and

other distribution rules.

An individual retirement annuity must be issued in your

name as the owner, and either you or your beneficiaries

who survive you are the only ones who can receive the

benefits or payments.

An individual retirement annuity must meet all the following requirements.

• Your entire interest in the contract must be nonforfeitable.

• The contract must provide that you can’t transfer any

portion of it to any person other than the issuer.

• There must be flexible premiums so that if your compensation changes, your payment can also change.

This provision applies to contracts issued after November 6, 1978.

• The contract must provide that contributions can’t be

more than the deductible amount for an IRA for the

year, and that you must use any refunded premiums to

pay for future premiums or to buy more benefits before

the end of the calendar year after the year in which

you receive the refund.

• Distributions must begin by April 1 of the year follow-

ing the year in which you reach age 73. See Pub.

590-B for more information about RMDs and other distribution rules.

Individual Retirement Bonds

The sale of individual retirement bonds issued by the federal government was suspended after April 30, 1982. The

bonds have the following features.

• They stop earning interest when you reach age 701/2.

If you die, interest will stop 5 years after your death, or

on the date you would have reached age 701/2,

whichever is earlier.

Chapter 1

A SEP arrangement is a written plan that allows an employer to make contributions to an employee’s traditional

SEP IRA or Roth SEP IRA. Employer contributions to SEP

IRAs are subject to different limits than individual contributions to traditional and Roth IRAs. Distributions from SEP

IRAs are subject to traditional and Roth IRA rules. See

Pub. 560 for more information about SEP arrangements

and SIMPLE IRAs.

Employer and Employee Association

Trust Accounts

Your employer or your labor union or other employee association can set up a trust to provide individual retirement

accounts for employees or members, provided certain requirements are met (such as separate accounting). The

requirements for individual retirement accounts apply to

these traditional and Roth IRAs.

Required Disclosures

The trustee or issuer (sometimes called the sponsor) of

your traditional IRA must generally give you a disclosure

statement at least 7 days before you open your IRA. However, the sponsor doesn’t have to give you the statement

until the date you open (or purchase, if earlier) your IRA,

provided you are given at least 7 days from that date to revoke the IRA.

The disclosure statement must explain certain items in

plain language. For example, the statement should explain

when and how you can revoke the IRA, and include the

name, address, and telephone number of the person to

receive the notice of cancellation. This explanation must

appear at the beginning of the disclosure statement.

Traditional IRAs

Publication 590-A (2025)

If you revoke your IRA within the revocation period, the

sponsor must return to you the entire amount you paid.

The sponsor must report on the appropriate IRS forms

both your contribution to the IRA (unless it was made by a

trustee-to-trustee transfer) and the amount returned to

you. These requirements apply to all sponsors.

• Naval Reserve,

• Marine Corps Reserve,

• Air National Guard of the United States,

• Air Force Reserve,

• Coast Guard Reserve, or

• Reserve Corps of the Public Health Service.

How Much Can Be

Contributed?

Figuring your IRA deduction. The repayment of

qualified reservist distributions doesn’t affect the amount

you can deduct as an IRA contribution.

There are limits and other rules that affect the amount that

can be contributed to a traditional IRA. These limits and

rules are explained below.

Reporting the repayment. If you repay a qualified reservist distribution, include the amount of the repayment

with nondeductible contributions on line 1 of Form 8606.

Community property laws. Except as discussed later

under Kay Bailey Hutchison Spousal IRA Limit, each

spouse figures their limit separately, using their own compensation. This is the rule even in states with community

property laws.

Example. In 2025, your IRA contribution limit is

$7,000. However, because of your filing status and AGI,

the limit on the amount you can deduct is $3,500. You can

make a nondeductible contribution of $3,500 ($7,000 –

$3,500). In an earlier year, you received a $3,000 qualified

reservist distribution, which you would like to repay this

year.

For 2025, you can contribute a total of $10,000 to your

IRA. This is made up of the maximum deductible contribution of $3,500; a nondeductible contribution of $3,500;

and a $3,000 qualified reservist repayment. You contribute

the maximum allowable for the year. Because you are

making a nondeductible contribution ($3,500) and a qualified reservist repayment ($3,000), you must file Form

8606 with your return and include $6,500 ($3,500 +

$3,000) on line 1 of Form 8606. The qualified reservist repayment isn’t deductible.

Brokers' commissions. Brokers' commissions paid in

connection with your traditional IRA are subject to the contribution limit. For information about whether you can deduct brokers' commissions, see Brokers' commissions,

later, under How Much Can You Deduct.

Trustees' fees. Trustees' administrative fees aren’t subject to the contribution limit. For information about whether

you can deduct trustees' fees, see Trustees' fees, later,

under How Much Can You Deduct.

Qualified reservist repayments. If you were a member

of a reserve component and you were ordered or called to

active duty after September 11, 2001, you may be able to

contribute (repay) to an IRA amounts equal to any qualified reservist distributions (defined under Early Distributions in Pub. 590-B) you received. You can make these repayment contributions even if they would cause your total

contributions to the IRA to be more than the general limit

on contributions. To be eligible to make these repayment

contributions, you must have received a qualified reservist

distribution from an IRA or from a section 401(k) or 403(b)

plan or a similar arrangement. See Early Distributions in

Pub. 590-B for more information on qualified reservist distributions.

Limit. Your qualified reservist repayments can’t be

more than your qualified reservist distributions.

When repayment contributions can be made. You

can’t make these repayment contributions later than the

date that is 2 years after your active duty period ends.

No deduction. You can’t deduct qualified reservist repayments.

Reserve component. The term “reserve component”

means the:

• Army National Guard of the United States,

• Army Reserve,

Publication 590-A (2025)

Contributions on your behalf to a traditional IRA

reduce your limit for contributions to a Roth IRA.

CAUTION See chapter 2 for information about Roth IRAs.

General Limit

For 2025, the most that can be contributed to your traditional IRA is generally the smaller of the following

amounts.

• $7,000 ($8,000 if you are age 50 or older).

• Your taxable compensation (defined earlier) for the

year.

Note: This limit is reduced by any contributions to a

section 501(c)(18) plan (generally, a pension plan created

before June 25, 1959, that is funded entirely by employee

contributions).

This is the most that can be contributed regardless of

whether the contributions are to one or more traditional

IRAs or whether all or part of the contributions are nondeductible. (See Nondeductible Contributions, later.) Qualified reservist repayments don’t affect this limit.

Examples. Gina, who is 34 years old and single, earns

$24,000 in 2025. Her IRA contributions for 2025 are limited to $7,000.

Chapter 1

Traditional IRAs

Danny, an unmarried college student working part time,

earns $3,500 in 2025. His IRA contributions for 2025 are

limited to $3,500, the amount of his compensation.

More than one IRA. If you have more than one IRA, the

limit applies to the total contributions made on your behalf

to all your traditional IRAs for the year.

Annuity or endowment contracts. If you invest in an

annuity or endowment contract under an individual retirement annuity, no more than $7,000 ($8,000 if you are age

50 or older) can be contributed toward its cost for the tax

year, including the cost of life insurance coverage. If more

than this amount is contributed, the annuity or endowment

contract is disqualified.

Kay Bailey Hutchison Spousal IRA

Limit

For 2025, if you file a joint return and your taxable compensation is less than that of your spouse, the most that

can be contributed for the year to your IRA is the smaller

of the following two amounts.

1. $7,000 ($8,000 if you are age 50 or older).

2. The total compensation includible in the gross income

of both you and your spouse for the year, reduced by

the following two amounts.

a. Your spouse's IRA contribution for the year to a

traditional IRA.

b. Any contributions for the year to a Roth IRA on behalf of your spouse.

This means that the total combined contributions that

can be made for the year to your IRA and your spouse's

IRA can be as much as $14,000 ($15,000 if only one of

you is age 50 or older, or $16,000 if both of you are age 50

or older).

Note: This traditional IRA limit is reduced by any contributions to a section 501(c)(18) plan (generally, a pension plan created before June 25, 1959, that is funded entirely by employee contributions).

Example. You are a full-time student with no taxable

compensation and marry during the year. Neither you nor

your spouse are at least age 50 by the end of 2025. Your

spouse has taxable compensation of $30,000. Your

spouse plans to contribute (and deduct) $7,000 to a traditional IRA. If you and your spouse file a joint return, you

and your spouse can each contribute $7,000 to a traditional IRA. Because you have no compensation, you can

add your spouse’s compensation, reduced by the amount

of your spouse’s IRA contribution ($30,000 – $7,000 =

$23,000), to your compensation (-0-) to figure your maximum contribution to a traditional IRA. In your case, $7,000

is your contribution limit, because $7,000 is less than

$23,000 (your compensation for purposes of figuring your

contribution limit).

Chapter 1

Filing Status

Generally, except as discussed earlier under Kay Bailey

Hutchison Spousal IRA Limit, your filing status has no effect on the amount of allowable contributions to your traditional IRA. However, if during the year either you or your

spouse was covered by a retirement plan at work, your deduction may be reduced or eliminated, depending on your

filing status and income. See How Much Can You Deduct,

later.

Example. You and your spouse are both age 53. You

both work and you both have a traditional IRA. You earned

$3,800 and your spouse earned $48,000 in 2025. Because of the Kay Bailey Hutchison Spousal IRA limit rule,

even though you earned less than $8,000, you can contribute up to $8,000 to your IRA for 2025 if you file a joint

return. Your spouse can contribute up to $8,000 to their

IRA. If you file separate returns, the amount that can be

contributed to your IRA is limited by your earned income,

$3,800.

Less Than Maximum Contributions

If contributions to your traditional IRA for a year were less

than the limit, you can’t contribute more after the due date

of your return for that year to make up the difference.

Example. You are age 40 and earn $30,000 in 2025.

Although you can contribute up to $7,000 for 2025, you

contribute only $3,000. After April 15, 2026, you can’t

make up the difference between your actual contributions

for 2025 ($3,000) and your 2025 limit ($7,000). You can’t

contribute $4,000 more than the limit for any later year.

More Than Maximum Contributions

If contributions to your IRA for a year were more than the

limit, you can apply the excess contribution in one year to

a later year if the contributions for that later year are less

than the maximum allowed for that year. However, a penalty or additional tax may apply. See Excess Contributions, later, under What Acts Result in Penalties or Additional Taxes.

When Can Contributions Be

Made?

As soon as you open your traditional IRA, contributions

can be made to it through your chosen sponsor (trustee or

other administrator). Contributions must be in the form of

money (cash, check, or money order). Property can’t be

contributed.

Although property can’t be contributed, your IRA may

invest in certain property. For example, your IRA may purchase shares of stock. For other restrictions on the use of

funds in your IRA, see Prohibited Transactions, later in this

chapter. You may be able to transfer or roll over certain

Traditional IRAs

Publication 590-A (2025)

property from one retirement plan to another. See the discussion of rollovers and other transfers later in this chapter

under Can You Move Retirement Plan Assets.

You can make a contribution to your IRA by having

TIP your income tax refund (or a portion of your re-

fund), if any, paid directly to your traditional IRA or

Roth IRA. For details, see the instructions for your income

tax return or Form 8888, Allocation of Refund.

Contributions can be made to your traditional IRA for

each year that you receive compensation. For any year in

which you don’t work, contributions can’t be made to your

IRA unless you receive taxable alimony, nontaxable combat pay, or military differential pay, or file a joint return with

a spouse who has compensation. See Who Can Open a

Traditional IRA, earlier. Even if contributions can’t be made

for the current year, the amounts contributed for years in

which you did qualify can remain in your IRA. Contributions can resume for any years that you qualify.

Contributions must be made by due date. Contributions can be made to your traditional IRA for a year at any

time during the year or by the due date for filing your return

for that year, not including extensions. For most people,

this means that contributions for 2025 must be made by

April 15, 2026.

For tax years beginning after 2019, the rule that

TIP you are not able to make contributions to your traditional IRA for the year in which you reach age

70½ and all later years has been repealed.

Designating year for which contribution is made. If

an amount is contributed to your traditional IRA between

January 1 and April 15, you should tell the sponsor which

year (the current year or the previous year) the contribution is for. If you don’t tell the sponsor which year it is for,

the sponsor can assume, and report to the IRS, that the

contribution is for the current year (the year the sponsor

received it).

Filing before a contribution is made. You can file your

return claiming a traditional IRA contribution before the

contribution is actually made. Generally, the contribution

must be made by the due date of your return, not including

extensions.

Contributions not required. You don’t have to contribute to your traditional IRA for every tax year, even if you

can.

How Much Can You Deduct?

Generally, you can deduct the lesser of:

• The contributions to your traditional IRA for the year,

• The general limit (or the Kay Bailey Hutchison Spousal

IRA limit, if applicable) explained earlier under How

Much Can Be Contributed.

Publication 590-A (2025)

Chapter 1

However, if you or your spouse was covered by an employer retirement plan, you may not be able to deduct this

amount. See Limit if Covered by Employer Plan, later.

You may be able to claim a credit for contributions

TIP to your traditional IRA. For more information, see

chapter 3.

Trustees' fees. Trustees' administrative fees that are billed separately and paid in connection with your traditional

IRA aren’t deductible as IRA contributions. You are also

not able to deduct these fees as an itemized deduction.

Brokers' commissions. These commissions are part of

your IRA contribution and, as such, are deductible subject

to the limits.

Full deduction. If neither you nor your spouse was covered for any part of the year by an employer retirement

plan, you can take a deduction for total contributions to

one or more of your traditional IRAs of up to the lesser of:

• $7,000 ($8,000 if you are age 50 or older), or

• 100% of your compensation.

This limit is reduced by any contributions made to a

section 501(c)(18) plan on your behalf.

Kay Bailey Hutchison Spousal IRA. In the case of a

married couple with unequal compensation who file a joint

return, the deduction for contributions to the traditional

IRA of the spouse with less compensation is limited to the

lesser of:

1. $7,000 ($8,000 if the spouse with the lower compensation is age 50 or older), or

2. The total compensation includible in the gross income

of both spouses for the year reduced by the following

three amounts.

a. The IRA deduction for the year of the spouse with

the greater compensation.

b. Any designated nondeductible contribution for the

year made on behalf of the spouse with the

greater compensation.

c. Any contributions for the year to a Roth IRA on behalf of the spouse with the greater compensation.

This limit is reduced by any contributions to a section

501(c)(18) plan on behalf of the spouse with the lesser

compensation.

Note: If you were divorced or legally separated (and

didn’t remarry) before the end of the year, you can’t deduct any contributions to your spouse's IRA. After a divorce or legal separation, you can deduct only the contributions to your own IRA. Your deductions are subject to

the rules for single individuals.

Covered by an employer retirement plan. If you or

your spouse was covered by an employer retirement plan

at any time during the year for which contributions were

made, your deduction may be further limited. This is

discussed later under Limit if Covered by Employer Plan.

Traditional IRAs

Limits on the amount you can deduct don’t affect the

amount that can be contributed.

Are You Covered by an Employer

Plan?

The Form W-2 you receive from your employer has a box

used to indicate whether you were covered for the year.

The “Retirement plan” box should be checked if you were

covered.

Reservists and volunteer firefighters should also see

Situations in Which You Aren’t Covered, later.

If you aren’t certain whether you were covered by your

employer's retirement plan, you should ask your employer.

Federal judges. For purposes of the IRA deduction, federal judges are covered by an employer plan.

For Which Year(s) Are You Covered?

Special rules apply to determine the tax years for which

you are covered by an employer plan. These rules differ

depending on whether the plan is a defined contribution

plan or a defined benefit plan.

Tax year. Your tax year is the annual accounting period

you use to keep records and report income and expenses

on your income tax return. For almost all people, the tax

year is the calendar year.

Defined contribution plan. Generally, you are covered

by a defined contribution plan for a tax year if amounts are

contributed or allocated to your account for the plan year

that ends with or within that tax year. However, also see

Situations in Which You Aren’t Covered, later.

A defined contribution plan is a plan that provides for a

separate account for each person covered by the plan. In

a defined contribution plan, the amount to be contributed

to each participant's account is spelled out in the plan.

The level of benefits actually provided to a participant depends on the total amount contributed to that participant's

account and any earnings and losses on those contributions. Types of defined contribution plans include

profit-sharing plans, stock bonus plans, and money purchase pension plans.

Example. Company A has a money purchase pension

plan. Its plan year is from July 1 to June 30. The plan provides that contributions must be allocated as of June 30.

An employee leaves Company A on December 31, 2024.

The contribution for the plan year ending on June 30,

2025, is made February 15, 2026. Because an amount is

contributed to the employee’s account for the plan year,

this employee is covered by the plan for their 2025 tax

year.

Note: A special rule applies to certain plans in which it

isn’t possible to determine if an amount will be contributed

to your account for a given plan year. If, for a plan year, no

amounts have been allocated to your account that are attributable

employer

contributions,

employee

Chapter 1

contributions, or forfeitures, by the last day of the plan

year, and contributions are discretionary for the plan year,

you aren’t covered for the tax year in which the plan year

ends. If, after the plan year ends, the employer makes a

contribution for that plan year, you are covered for the tax

year in which the contribution is made.

Example. You were covered by a profit-sharing plan

and left the company on December 31, 2024. The plan

year runs from July 1 to June 30. Under the terms of the

plan, employer contributions don’t have to be made, but if

they are made, they are contributed to the plan before the

due date for filing the company's tax return. Such contributions are allocated as of the last day of the plan year, and

allocations are made to the accounts of individuals who

have any service during the plan year. As of June 30,

2025, no contributions were made that were allocated to

the June 30, 2025, plan year, and no forfeitures had been

allocated within the plan year. In addition, as of that date,

the company wasn’t obligated to make a contribution for

such plan year, and it was impossible to determine

whether or not a contribution would be made for the plan

year. On December 31, 2025, the company decided to

contribute to the plan for the plan year ending June 30,

2025. That contribution was made on February 15, 2026.

You are an active participant in the plan for your 2026 tax

year but not for your 2025 tax year.

No vested interest. If an amount is allocated to your

account for a plan year, you are covered by that plan even

if you have no vested interest in (legal right to) the account.

Defined benefit plan. If you are eligible to participate in

your employer's defined benefit plan for the plan year that

ends within your tax year, you are covered by the plan.

This rule applies even if you:

• Declined to participate in the plan,

• Didn’t make a required contribution, or

• Didn’t perform the minimum service required to accrue

a benefit for the year.

A defined benefit plan is any plan that isn’t a defined

contribution plan. In a defined benefit plan, the level of

benefits to be provided to each participant is spelled out in

the plan. The plan administrator figures the amount needed to provide those benefits, and those amounts are contributed to the plan. Defined benefit plans include pension

plans and annuity plans.

Example. You are an employee of Company B and are

eligible to participate in Company B's defined benefit plan,

which has a July 1 to June 30 plan year. You leave Company B on December 31, 2024. Because you are eligible

to participate in the plan for its year ending June 30, 2025,

you are covered by the plan for your 2025 tax year.

No vested interest. If you accrue a benefit for a plan

year, you are covered by that plan even if you have no vested interest in (legal right to) the accrual.

Traditional IRAs

Publication 590-A (2025)

Situations in Which You Aren’t Covered

Unless you are covered by another employer plan, you

aren’t covered by an employer plan if you are in one of the

situations described below.

Social security or railroad retirement. Coverage under

social security or railroad retirement isn’t coverage under

an employer retirement plan.

Benefits from previous employer's plan. If you receive

retirement benefits from a previous employer's plan, you

aren’t covered by that plan.

Reservists. If the only reason you participate in a plan is

because you are a member of a reserve unit of the Armed

Forces, you may not be covered by the plan. You aren’t

covered by the plan if both of the following conditions are

met.

1. The plan you participate in is established for its employees by:

a. The United States,

b. A state or political subdivision of a state, or

c. An instrumentality of either (a) or (b) above.

2. You didn’t serve more than 90 days on active duty

during the year (not counting duty for training).

Volunteer firefighters. If the only reason you participate

in a plan is because you are a volunteer firefighter, you

may not be covered by the plan. You aren’t covered by the

plan if both of the following conditions are met.

1. The plan you participate in is established for its employees by:

a. The United States,

b. A state or political subdivision of a state, or

c. An instrumentality of either (a) or (b) above.

2. Your accrued retirement benefits at the beginning of

the year won’t provide more than $1,800 per year at

retirement.

Limit if Covered by Employer Plan

As discussed earlier, the deduction you can take for contributions made to your traditional IRA depends on

whether you or your spouse was covered for any part of

the year by an employer retirement plan. Your deduction is

also affected by how much income you had and by your

filing status. Your deduction may also be affected by social

security benefits you received.

Reduced or no deduction. If either you or your spouse

was covered by an employer retirement plan, you may be

entitled to only a partial (reduced) deduction or no deduction at all, depending on your income and your filing status.

Your deduction begins to decrease (phase out) when

your income rises above a certain amount and is

Publication 590-A (2025)

Chapter 1

eliminated altogether when it reaches a higher amount.

These amounts vary depending on your filing status.

To determine if your deduction is subject to the phaseout, you must determine your modified AGI and your filing

status, as explained later under Deduction Phaseout.

Once you have determined your modified AGI and your filing status, you can use Table 1-2 or Table 1-3 to determine if the phaseout applies.

Social Security Recipients

Instead of using Table 1-2 or Table 1-3 and Worksheet

1-2, complete the worksheets in Appendix B of this publication if, for the year, all of the following apply.

• You received social security benefits.

• You received taxable compensation.

• Contributions were made to your traditional IRA.

• You or your spouse was covered by an employer retirement plan.

Use the worksheets in Appendix B to figure your IRA deduction, your nondeductible contribution, and the taxable

portion, if any, of your social security benefits. Appendix B

includes an example with filled-in worksheets to assist

you.

Deduction Phaseout

The amount of any reduction in the limit on your IRA deduction (phaseout) depends on whether you or your

spouse was covered by an employer retirement plan.

Covered by a retirement plan. If you are covered by an

employer retirement plan and you didn’t receive any social

security retirement benefits, your IRA deduction may be

reduced or eliminated depending on your filing status and

modified AGI, as shown in Table 1-2.

If your spouse is covered. If you aren’t covered by an

employer retirement plan, but your spouse is, and you

didn’t receive any social security benefits, your IRA deduction may be reduced or eliminated entirely depending

on your filing status and modified AGI as shown in Table 1-3.

Filing status. Your filing status depends primarily on your

marital status. For this purpose, you need to know if your

filing status is single or head of household, married filing

jointly or qualifying surviving spouse, or married filing separately. If you need more information on filing status, see

Pub. 501, Dependents, Standard Deduction, and Filing Information.

Lived apart from spouse. If you didn’t live with your

spouse at any time during the year and you file a separate

return, your filing status, for this purpose, is single.

Modified AGI. You can use Worksheet 1-1 to figure your

modified AGI. If you made contributions to your IRA for

2025 and received a distribution from your IRA in 2025,

see Both contributions for 2025 and distributions in 2025,

later.

Traditional IRAs

Table 1-2. Effect of Modified AGI1 on Deduction if You Are Covered by a Retirement Plan at

Work

If you are covered by a retirement plan at work, use this table to determine if your modified AGI affects the amount of your

deduction.

IF your filing status is...

AND your modified AGI is...

single or

head of household

married filing jointly or

qualifying surviving spouse

married filing separately2

THEN you can take...

$79,000 or less

a full deduction.

more than $79,000

but less than $89,000

a partial deduction.

$89,000 or more

no deduction.

$126,000 or less

a full deduction.

more than $126,000

but less than $146,000

a partial deduction.

$146,000 or more

no deduction.

less than $10,000

a partial deduction.

$10,000 or more

no deduction.

Modified AGI (adjusted gross income). See Modified adjusted gross income (AGI), earlier.

If you didn’t live with your spouse at any time during the year, your filing status is considered Single for this purpose (therefore, your IRA deduction

is determined under the “Single” filing status).

Table 1-3. Effect of Modified AGI1 on Deduction if You Aren’t Covered by a Retirement Plan at

Work

If you aren’t covered by a retirement plan at work, use this table to determine if your modified AGI affects the amount of

your deduction.

IF your filing status is...

AND your modified AGI is...

THEN you can take...

single,

head of household, or

qualifying surviving spouse

any amount

a full deduction.

married filing jointly or separately with a

spouse who isn’t covered by a plan

at work

any amount

a full deduction.

$236,000 or less

a full deduction.

more than $236,000

but less than $246,000

a partial deduction.

$246,000 or more

no deduction.

less than $10,000

a partial deduction.

$10,000 or more

no deduction.

married filing jointly with a spouse who is

covered by a plan at work

married filing separately with a spouse who is

covered by a plan at work2

Modified AGI (adjusted gross income). See Modified adjusted gross income (AGI), earlier.

You are entitled to the full deduction if you didn’t live with your spouse at any time during the year.

Don’t assume that your modified AGI is the same

as your compensation. Your modified AGI may inCAUTION clude income in addition to your compensation

(discussed earlier) such as interest, dividends, and income from IRA distributions.

Form 1040 or 1040-SR. If you file Form 1040 or

1040-SR, refigure the amount on line 11a, the “adjusted

gross income” line, without taking into account any of the

following amounts.

• Foreign earned income exclusion.

• Foreign housing exclusion or deduction.

• Exclusion of qualified savings bond interest shown on

Form 8815.

• Exclusion of employer-provided adoption benefits

shown on Form 8839.

This is your modified AGI.

• IRA deduction.

• Student loan interest deduction.

Chapter 1

Traditional IRAs

Publication 590-A (2025)

Form 1040-NR. If you file Form 1040-NR, refigure the

amount on line 11a, the “adjusted gross income” line,

without taking into account any of the following amounts.

• IRA deduction.

• Student loan interest deduction.

• Exclusion of qualified savings bond interest shown on

Form 8815.

• Exclusion of employer-provided adoption benefits

shown on Form 8839.

This is your modified AGI.

Income from IRA distributions. If you received distributions in 2025 from one or more traditional IRAs and your

traditional IRAs include only deductible contributions, your

distributions are fully taxable and are included in your

modified AGI. See Pub. 590-B for more information on distributions.

Publication 590-A (2025)

Chapter 1

Both contributions for 2025 and distributions in

2025. If all three of the following apply, any IRA distributions you received in 2025 may be partly tax free and

partly taxable.

• You received distributions in 2025 from one or more

traditional IRAs.

• You made contributions to a traditional IRA for 2025.

• Some of those contributions may be nondeductible

contributions. (See Nondeductible Contributions and

Worksheet 1-2, later.)

If this is your situation, you must figure the taxable part of

the traditional IRA distribution before you can figure your

modified AGI. To do this, you can use Worksheet 1-1 in

Pub. 590-B.

If at least one of the above doesn’t apply, figure your

modified AGI using Worksheet 1-1.

Traditional IRAs

How To Figure Your Reduced IRA Deduction

If you or your spouse is covered by an employer retirement

plan and you didn’t receive any social security benefits,

you can figure your reduced IRA deduction by using Worksheet 1-2. The Instructions for Form 1040 include a similar

worksheet that you can use instead of the worksheet in

this publication.

If you or your spouse is covered by an employer retirement plan, and you received any social security benefits,

see Social Security Recipients, earlier.

Note: If you were married and both you and your

spouse contributed to an IRA, figure your deduction and

your spouse's deduction separately.

Reporting Deductible Contributions

If you file Schedule 1 (Form 1040), enter your IRA deduction on line 20 of that form.

Self-employed. If you are self-employed (a sole proprietor or partner) and have a SIMPLE IRA, enter your deduction for allowable plan contributions on Schedule 1 (Form

1040), line 16.

Nondeductible Contributions

Although your deduction for IRA contributions may be reduced or eliminated, contributions can be made to your

IRA of up to the general limit or, if it applies, the Kay Bailey

Hutchison Spousal IRA limit. The difference between your

total permitted contributions and your IRA deduction, if

any, is your nondeductible contribution.

Example. You are 29 years old and single. In 2025,

you were covered by a retirement plan at work. Your salary

is $72,000. Your modified AGI is $90,000. You make a

$7,000 IRA contribution for 2025. Because you were covered by a retirement plan and your modified AGI is above

$89,000, you can’t deduct your $7,000 IRA contribution.

You must designate this contribution as a nondeductible

contribution by reporting it on Form 8606.

Repayment of reservist distributions. Nondeductible

contributions may include repayments of qualified reservist distributions. For more information, see Qualified reservist repayments under How Much Can Be Contributed,

earlier.

Difficulty of care payments. For contributions after December 20, 2019, you are able to elect to increase the

nondeductible IRA contribution limit by some or all of the

amount of difficulty of care payments, which are a type of

qualified foster care payment, received. If you receive difficulty of care payments, then those amounts may increase

the amount of nondeductible IRA contributions you can

make but not above the $7,000 IRA deductible amount

($8,000 if you are age 50 or older). The increase to the

nondeductible IRA contribution limit equals the lesser of (i)

the amount of difficulty of care payments excluded from

gross income, or (ii) the amount by which the deductible

limit for IRA contributions exceeds the amount of the taxpayer's compensation included in gross income for the tax

year.

Form 8606. To designate contributions as nondeductible,

you must file Form 8606.

You don’t have to designate a contribution as nondeductible until you file your tax return. When you file, you

can even designate otherwise deductible contributions as

nondeductible contributions.

You must file Form 8606 to report nondeductible contributions even if you don’t have to file a tax return for the

year.

A Form 8606 isn’t used for the year that you make

a rollover from a qualified retirement plan to a traCAUTION ditional IRA and the rollover includes nontaxable

amounts. In those situations, a Form 8606 is completed

for the year you take a distribution from that IRA. See

Form 8606 under Distributions Fully or Partly Taxable in

Pub. 590-B.

Worksheet 1-1. Figuring Your Modified AGI

Keep for Your Records

Use this worksheet to figure your modified AGI for traditional IRA purposes.

Enter your adjusted gross income (AGI) from Form 1040, 1040-SR, or Form 1040-NR,

line 11a, figured without taking into account the amount from Schedule 1 (Form 1040),

line 20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Enter any student loan interest deduction from Schedule 1 (Form 1040), line 21 . . . . . . . . . .

Enter any foreign earned income exclusion and/or housing exclusion from Form 2555,

line 45 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Enter any foreign housing deduction from Form 2555, line 50 . . . . . . . . . . . . . . . . . . . . . . . . .

Enter any excludable savings bond interest from Form 8815, line 14 . . . . . . . . . . . . . . . . . . .

Enter any excluded employer-provided adoption benefits from Form 8839, line 30 . . . . . . . .

Add lines 1 through 6. This is your modified AGI for traditional IRA purposes . . . . . . . . . . . .

Chapter 1

Traditional IRAs

Publication 590-A (2025)

Failure to report nondeductible contributions. If you

don’t report nondeductible contributions, all of the contributions to your traditional IRA will be treated like deductible contributions when withdrawn. All distributions from

your IRA will be taxed unless you can show, with satisfactory evidence, that nondeductible contributions were

made.

Penalty for overstatement. If you overstate the amount

of nondeductible contributions on your Form 8606 for any

tax year, you must pay a penalty of $100 for each overstatement, unless it was due to reasonable cause.

Penalty for failure to file Form 8606. You will have to

pay a $50 penalty if you don’t file a required Form 8606,

unless you can prove that the failure was due to reasonable cause.

Tax on earnings on nondeductible contributions. As

long as contributions are within the contribution limits,

none of the earnings or gains on contributions (deductible

or nondeductible) will be taxed until they are distributed.

Cost basis. You will have a cost basis in your traditional

IRA if you made any nondeductible contributions. Your

cost basis is the sum of the nondeductible contributions to

your IRA minus any withdrawals or distributions of nondeductible contributions.

Commonly, distributions from your traditional IRAs

will include both taxable and nontaxable (cost baCAUTION sis) amounts. See Pub. 590-B for more information on distributions.

Recordkeeping. There is a recordkeeping worksheet, Appendix A. Summary Record of TradiRECORDS tional IRA(s) for 2025, that you can use to keep a

record of deductible and nondeductible IRA contributions.

Examples—Worksheet for Reduced

IRA Deduction for 2025

The following examples illustrate the use of Worksheet

1-2.

Example 1. For 2025, you and your spouse file a joint

return on Form 1040. You are both 39 years old. You are

both employed. You are covered by your employer’s retirement plan. However, your spouse isn’t covered by their

employer’s retirement plan. Your salary is $66,000, and

your spouse’s salary is $51,500. You each have a traditional IRA and your combined modified AGI, which includes $9,000 interest and dividend income, is $126,500.

Publication 590-A (2025)

Chapter 1

Because your modified AGI is between $126,000 and

$146,000 and you are covered by an employer plan, you

are subject to the deduction phaseout discussed earlier

under Limit if Covered by Employer Plan.

For 2025, you and your spouse each contributed

$7,000 to your respective IRAs. Even though you file a

joint return, you must figure their IRA deductions

separately.

You can take a deduction of only $6,825. Using Worksheet 1-2, you figure your deductible and nondeductible

amounts as shown on Worksheet 1-2. Figuring Your Reduced IRA Deduction for 2025—Example 1 Illustrated.

You can choose to treat the $6,825 as either deductible

or nondeductible contributions. You can either leave the

$175 ($7,000 − $6,825) of nondeductible contributions in

your IRA or withdraw them by April 15, 2026. You decide

to treat the $6,825 as a deductible contribution and leave

the $175 of nondeductible contributions in your IRA.

Your spouse can treat all or part of their $7,000 contribution as either deductible or nondeductible. This is because they aren’t covered by their employer's retirement

plan and your combined modified AGI isn’t between

$236,000 and $246,000. Therefore, they aren’t subject to

the deduction phaseout discussed earlier under Limit if

Covered by Employer Plan, and they don’t need to use

Worksheet 1-2. Your spouse decides to treat their $7,000

IRA contribution as deductible.

The IRA deductions of $6,825 and $7,000 on the joint

return for you and your spouse total $13,825.

Example 2. For 2025, you and your spouse file a joint

return on Form 1040. You are both 39 years old. Your salary is $45,500 and you are covered by your employer's retirement plan. Your spouse had no compensation for the

year and was not covered by an employer plan. You contribute $7,000 to your traditional IRA and $7,000 to your

spouse's traditional IRA (a Kay Bailey Hutchison Spousal

IRA). Your combined modified AGI which includes $2,000

interest and dividend income and a large capital gain from

the sale of stock is $238,500.

Because your combined modified AGI is $146,000 or

more and you are covered by your employer's plan, you

can’t deduct any of the contribution to your traditional IRA.

You can either leave the $7,000 of nondeductible contributions in your IRA or withdraw them by April 15, 2026.

Your spouse figures their IRA deduction as shown on

Worksheet 1-2. Figuring Your Reduced IRA Deduction for

2025—Example 2 Illustrated.

Traditional IRAs

Worksheet 1-2. Figuring Your Reduced IRA

Deduction for 2025

Keep for Your Records

(Use only if you or your spouse is covered by an employer plan and your modified AGI falls between the two amounts

shown below for your coverage situation and filing status.)

Note. If you were married and both you and your spouse contributed to IRAs, figure your deduction and your spouse's

deduction separately.

IF you...

are covered by an

employer plan

aren’t covered by an

employer plan, but your

spouse is covered

AND your

modified AGI THEN enter on

is over...

line 1 below...

AND your

filing status is...

single or head of

household

$79,000

$89,000

married filing jointly or

qualifying surviving

spouse

$126,000

$146,000

married filing separately

$10,000

married filing jointly

$236,000

$246,000

married filing separately

$10,000

Enter applicable amount from table above . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Enter your modified AGI (that of both spouses, if married filing jointly) . . . . . . . . . . . . . . . . . . . . . .

Note: If line 2 is equal to or more than the amount on line 1, stop here.

Your IRA contributions aren’t deductible. See Nondeductible Contributions, earlier.

Subtract line 2 from line 1. If line 3 is $10,000 or more ($20,000 or more if married filing

jointly or qualifying surviving spouse and you are covered by an employer plan), stop

here. You can take a full IRA deduction for contributions of up to $7,000 ($8,000 if you are age 50

or older) or 100% of your (and if married filing jointly, your spouse's) compensation, whichever is

less . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Multiply line 3 by the percentage below that applies to you. If the result isn’t a multiple of

$10, round it to the next highest multiple of $10. (For example, $611.40 is rounded to

$620.) However, if the result is less than $200, enter $200.

• Married filing jointly or qualifying surviving spouse and you are covered by an

employer plan, multiply line 3 by 35% (0.35) (by 40% (0.40) if you are age 50 or

older).

All others, multiply line 3 by 70% (0.70) (by 80% (0.80) if you are age 50 or older).

......

Enter your compensation minus any deductions on Schedule 1 (Form 1040), line 15 (deductible

part of self-employment tax), and Schedule 1 (Form 1040), line 16 (self-employed SEP, SIMPLE,

and qualified plans). If you are filing a joint return and your compensation is less than your

spouse's, include your spouse's compensation reduced by their traditional IRA and Roth IRA

contributions for this year. If you file Form 1040, 1040-SR, or 1040-NR, don’t reduce your

compensation by any losses from self-employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Enter contributions made, or to be made, to your IRA for 2025, but don’t enter more than $7,000

($8,000 if you are age 50 or older). If contributions are more than $7,000 ($8,000 if you are age 50

or older), see Excess Contributions, later . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

IRA deduction. Compare lines 4, 5, and 6. Enter the smallest amount (or a smaller amount if you

choose) here and on your Schedule 1 (Form 1040), line 20. If line 6 is more than line 7 and you

want to make a nondeductible contribution, go to line 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Nondeductible contribution. Subtract line 7 from line 5 or line 6, whichever is smaller.

Enter the result here and on line 1 of your Form 8606 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

•

Chapter 1

Traditional IRAs

Publication 590-A (2025)

Worksheet 1-2. Figuring Your Reduced IRA Deduction for 2025—Example 1 Illustrated

(Use only if you or your spouse is covered by an employer plan and your modified AGI falls between the two amounts

shown below for your coverage situation and filing status.)

Note. If you were married and both you and your spouse contributed to IRAs, figure your deduction and your spouse's

deduction separately.

IF you...

are covered by an

employer plan

aren’t covered by an

employer plan, but your

spouse is covered

AND your

modified AGI THEN enter on

is over...

line 1 below...

AND your

filing status is...

single or head of

household

$79,000

$89,000

married filing jointly or

qualifying surviving

spouse

$126,000

$146,000

married filing separately

$10,000

married filing jointly

$236,000

$246,000

married filing separately

$10,000

Enter applicable amount from table above . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

146,000

Enter your modified AGI (that of both spouses, if married filing jointly) . . . . . . . . . . . . . . . . . . . . . .

126,500

19,500

......

6,825

Enter your compensation minus any deductions on Schedule 1 (Form 1040), line 15 (deductible

part of self-employment tax), and Schedule 1 (Form 1040), line 16 (self-employed SEP, SIMPLE,

and qualified plans). If you are filing a joint return and your compensation is less than your

spouse's, include your spouse's compensation reduced by their traditional IRA and Roth IRA

contributions for this year. If you file Form 1040, 1040-SR, or 1040-NR, don’t reduce your

compensation by any losses from self-employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

66,000

Enter contributions made, or to be made, to your IRA for 2025, but don’t enter more than $7,000

($8,000 if you are age 50 or older). If contributions are more than $7,000 ($8,000 if you are age 50

or older), see Excess Contributions, later . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7,000

IRA deduction. Compare lines 4, 5, and 6. Enter the smallest amount (or a smaller amount if you

choose) here and on your Schedule 1 (Form 1040), line 20. If line 6 is more than line 7 and you

want to make a nondeductible contribution, go to line 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6,825

Nondeductible contribution. Subtract line 7 from line 5 or line 6, whichever is smaller.

Enter the result here and on line 1 of your Form 8606 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

175

Note: If line 2 is equal to or more than the amount on line 1, stop here.

Your IRA contributions are not deductible. See Nondeductible Contributions, earlier.