IRA deduction Individual retirement account

You may be able to claim a deduction on your income tax return for the amount you contributed to your IRA. We generally follow the IRS when it comes to deduction limits.

Maximum contribution amounts

For 2019, you can contribute to a traditional IRA up to:

  • $6,000 if you are under the age of 50
  • $7,000 if you are age 50 or older by the end of the tax year

You cannot contribute more than your taxable compensation (salary and benefits) for the year. For instance, if your taxable compensation is $1,800, you can only contribute up to $1,800.

When you can contribute

Contributions can be made up to the filing due date of your tax return, usually April 15.

Example
You make a contribution of $2,000 on February 1, 2021. Your return for the 2020 tax year is due April 15, 2021. Your contribution may be deductible on your 2020 return.

Maximum deduction amounts

You may be able to deduct your full contribution, part of your contribution or none. Your deduction will depend on:

  • If you are covered by a retirement plan at work or not
  • Your filing status

For 2019, the full deduction limits are:

  • Under age 50 you may deduct up to $6,000
  • Over age 50 you may deduct up to $7,000

Refer to 2019 Pension and Annuity Guidelines (FTB Publication 1005) for more information.

If you do not have a retirement plan at work

2020 Tax year - No retirement plan at work

If Your Filing Status Is... And Your Modified AGI Is... Then your deduction is…
Single, Head of household, or Qualifying widow(er) any amount a full deduction up to the contribution limit
Married filing jointly with a spouse who is not covered by a plan at work any amount a full deduction up to contribution limit
Married filing jointly with a spouse who is covered by a plan at work $193,000 or less a full deduction up to contribution limit
more than $193,000 but less than $203,000 a partial deduction
$203,000 or more no deduction
Married filing separately with a spouse who is covered by a plan at work less than $10,000 a partial deduction
$10,000 or more no deduction

If you are covered by a retirement plan at work

2020 Tax year - Retirement plan at work

If Your Filing Status Is... And Your Modified AGI Is... Then your deduction is…
Single, or Head of household $64,000 or less a full deduction up to the contribution limit
more than $64,000 but less than $74,000 a partial deduction
$74,000 or more no deduction
Married filing jointly or qualifying widow(er) $103,000 or less a full deduction up to contribution limit
More than $103,000 but less than $123,000 a partial deduction
$123,000 or more no deduction
Married filing separately $0 a full deduction up to contribution limit
Less than $10,000 a partial deduction
$10,000 or more no deduction

How to report

Federal return

The IRA deduction is an adjustment to gross income. Report the IRA deduction on the IRA Deduction line of your federal return.

California return

This deduction will be included in your federal adjusted gross income, which you report on your California return.

Residents

Use California Adjustments – Residents (Schedule CA 540).

Refer to Instructions for 540 Schedule CA, California Adjustments – Residents for more information.

Nonresidents or Part-Year Residents

Use California Adjustments - Nonresidents or Part-Year Residents (Schedule CA 540NR).

Refer to Instructions for form 540NR, California Nonresident or Part-Year Resident Income Tax Return for more information.

IRS resources