Your deduction phases out with MAGI — if a workplace plan covers you
IRS Notice 2025-67 sets the 2026 phase-out ranges under section 219(g). Anyone can contribute to a traditional IRA, but the deduction shrinks inside these MAGI bands — and disappears above them — when a workplace retirement plan covers you (or, on a joint return, your spouse).
Single/HoH, covered: $81,000–$91,000. Joint, contributor covered: $129,000–$149,000. Joint, only spouse covered: $242,000–$252,000. Separate, covered: $0–$10,000.
| Filing status | Who is covered | 2026 phase-out range |
|---|---|---|
| Single / head of household | You | $81,000–$91,000 |
| Joint / surviving spouse | Contributing spouse | $129,000–$149,000 |
| Joint | Only the other spouse | $242,000–$252,000 |
| Separate | You | $0–$10,000 |
| Any | Nobody | No phase-out — fully deductible |
Worked examples (match the calculator)
| Case | MAGI | Deductible share | On $7,500 |
|---|---|---|---|
| Single, covered | $86,000 | 50% | $3,750 |
| Single, covered | $80,000 | 100% | $7,500 |
| Joint, contributor covered | $139,000 | 50% | $3,750 |
| Joint, only spouse covered | $247,000 | 50% | $3,750 |
| Separate, covered | $5,000 | 50% | $3,750 |
The math inside a range is linear: deductible = contribution × (end − MAGI) ÷ (end − start). A $4,000 contribution at 50% gives $2,000 deductible and $2,000 nondeductible. Age 50+ uses the $8,600 catch-up limit instead of $7,500.
Common mistakes
- Using plain AGI instead of modified AGI (§219(g)(3)(A) adds back items like student-loan interest).
- Assuming Roth IRA ranges apply here — Roth uses §408A(c)(3) bands ($153,000–$168,000 single), a different table.
- Forgetting the MFS trap: a covered spouse filing separately phases out over just $0–$10,000.
No. It still grows tax-deferred; you track the after-tax basis on Form 8606 so you are not taxed twice at withdrawal.
No. Contributions above the $7,500 / $8,600 limit face a 6% yearly excise under §4973 — a separate calculation.