Can You Contribute to a Traditional IRA After Filing Your Taxes?

You can still contribute to an IRA even if you have already filed your tax return. You can contribute up until the tax return filing deadline no matter when you filed.

If you’re interested in making a Roth contribution, see Roth IRA Contributions After You File.

This post is provided for general information only. Please confirm the details and circumstances of your unique situation with your tax accountant or other appropriate advisor before taking action.

Why would you contribute to an IRA after filing your taxes?

There are several reasons you might want to contribute to a traditional IRA after filing your taxes.

  • Your income increased, and you have extra money.
  • You were holding cash in a savings account and now want to invest it.
  • You got your tax refund and didn’t realize you could use it to fund your IRA.
  • You didn’t know you could take a tax deduction.
  • You simply changed your mind.

No matter why you want to contribute to your IRA, you can do so as long as you haven’t met your contribution limit for the year.

What is the benefit of contributing to an IRA after filing your taxes?

The main benefit is making the most of your IRA contribution limits. You can only put in $6,000 per year.

Let’s say you didn’t contribute anything in 2022 but now have $1,000 in early 2023. You can either put it towards 2022 or 2023. If you put it towards 2022, you can still potentially contribute another $6,000 in 2023. If you put it towards 2023, you only have $5,000 remaining for 2023.

If you qualify for a deductible IRA, you can also reduce your taxes and get a bigger refund.

Do you need to amend your tax return to contribute to an IRA after filing your taxes?

You do need to amend your tax return if you decide to contribute to an IRA after you filed. The reason is your IRA contributions affect your deductions.

Even if you’re making non-deductible contributions to a traditional IRA, the IRS requires you to report them on Form 8606.

You may also need to amend your tax return to take advantage of the Saver’s Credit.

The Saver’s Credit is a tax credit that lets low to middle-income earners take a tax credit for retirement contributions, including IRA contributions. If you’re under the income limit, you will want to amend your tax return to claim the credit and get some money back.

How does the IRS know what you contributed to an IRA?

Your IRA provider sends Form 5498 to the IRS each summer. Form 5498 reports your IRA contributions and the type of account. This lets the IRS know what you’ve contributed, and it’s also good to keep for your records.

Should you use your tax refund to fund your IRA?

You can use your tax refund to fund your IRA, but you need to put the cash in your IRA by the tax filing deadline. If you file early in tax season, you’ll usually get your refund in plenty of time. However, there’s a risk that a problem with your tax return could delay your refund until after April 15th.

Similarly, if you don’t file until later in March or April, the IRS may not issue your refund in time for you to deposit it into your IRA.

If you don’t get your refund into your IRA by the tax filing deadline, you’ll have to count it as a contribution for next year.

What should you do if the IRS contacts you?

In rare cases, you may get a CP12 notice or some other notice from the IRS saying you made a mistake and owe more taxes. Assuming you did everything correctly, send a written explanation of what you did, and the IRS won’t charge you more.

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1 thought on “Can You Contribute to a Traditional IRA After Filing Your Taxes?”

  1. In most cases it’s worth borrowing money to fund an IRA as the tax savings will typically far exceed the interest on the loan. Even if the tax reduction was modestly greater than the interest on the loan. As long as the borrower can afford to pay the loan they now have money in an IRA that they otherwise would not have, Most people will pay back a loan but are less likely to save money to invest. If I had more time I would include examples and more advice but you get the idea.

    Reply
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