Kokua Line
My tax adviser says that since I am not vested in the pension plan, I should be able to claim my Individual Retirement Arrangement contributions as deductible on my income tax return. My W-2 Form, however, is checked to show that I am covered by a pension plan. When I called the payroll office, workers said there was nothing in the procedures that allows issuing a "corrected" W-2 form.
My tax adviser is on vacation until mid-May. I'm hoping you can help before then.
IRS Publication 17, Page 146, says: "Even if your employer sets aside only a very small amount for you under a retirement plan, you are considered covered by the plan for the year."
It continues: "If, for a plan year, an amount is allocated to your plan account in a defined contribution plan, or you accrue a benefit in a defined benefit plan, but you have no vested interest in such account or accrual, you are still an active participant (covered by) such plan.
You may want to order IRS Publication 590, which deals with IRAs, and Form 8606, which deals with Nondeductible IRAs. Dial 1-800-829-3676 to order the material.
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