STEP
5 ADJUSTMENTS TO INCOME
All taxpayers report adjustments from all
sources in this section.
NONRESIDENTS AND PART-YEAR RESIDENTS report
Iowa-source adjustments to income on Schedule
IA126, lines 16-24.
16. PAYMENTS TO AN IRA,
KEOGH PLAN, SEP, or SIMPLE or Qualified Plans
Enter the amount claimed on your Federal tax
return for payments made to your IRA, Keogh Plan, SEP, SIMPLE, or Qualified
Plans.
Iowa will allow any 2005 Federal changes to
certain qualified pension plans and IRAs. Payments made to a Roth IRA are
not deductible.
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Married Separate Filers:
- If only one spouse has earned
income, that individual can contribute to an IRA account of the
nonworking spouse.
When claiming the deduction between
spouses, the working spouse will usually claim all of the deduction,
not to exceed the Federal limits for both spouses. However, if the
nonworking spouse has any earned income, then the nonworking spouse
must claim the deduction to the extent of his/her earned income. The
working spouse will then claim the balance of the IRA contribution
of both spouses. (Examples
of how to prorate)
- If both spouses earned income
and made contributions to an IRA account, each spouse must claim his
or her own contribution allowed by Internal Revenue Service guidelines.
- If both spouses made contributions
to an IRA but only a portion of the contribution is deductible on the
Federal return, the amount of the IRA deduction that is allowed for
Federal income tax purposes must be allocated between the spouses in
the ratio of the IRA contribution made by each spouse to the total
IRA contribution made by both spouses. (Examples
of how to prorate)
- For Keogh Plans, SEPs, SIMPLE,
or Qualified Plans, each spouse must claim his or her individual
contributions.
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