Robert-

You can make non-deductible IRA contributions regardless of your income or participation in a pension plan. You are OK.

Larry

In your situation, I think it makes a lot of sense to make a non-deductible IRA contribution each year. I wrote about this opportunity last March in an article called the Re-Emergence of Non-Deductible IRAs available at www.mdtaxes.com/news0307.html.

Zip Code: 01801

Andrew,

I just read the Non-deductible IRA article you just referred us to. In the last couple of paragraphs you explain that if you shuttle IRA money into your employer 401(k), you could get around that money diluting the after-tax basis.

However, if you make your final non-deductible contribution in 2010 (let's say January 2), when would that shuttling into the employer 401(k) have to occur?

Also, what if you leave your employer prior to 2010, but still leave your funds in that employer's plan? Can you, for example, shuttle the IRA funds into the employer plan, resign a few months later (say, in 2009) while leaving your funds in the now-former employer's plan, and still do a Roth rollover with your separate (non-deductible) money without diluting the after-tax basis of the would-be Roth?

Thanks a lot for answering

Robert, given your situation you should definitely hire a CPA to do tax and retirement planning. -dr. chris