Can I still have a traditional IRA if I contribute to my 401(k) plan at work? Answer: Yes. Anyone with earned income can open and contribute to a traditional IRA. The contribution limit is $3,000 for tax years 2002-2004, plus an additional "catch-up" contribution if you're 50 or older ($500 for tax years 2002-2005). However, you may not be able to deduct your IRA contributions since you're covered by a 401(k) plan at work. Whether or not you can deduct your IRA contributions depends on your filing status and annual income (adjusted gross income, or AGI). Specifically, for 2004: If your filing status is: Your IRA deduction is reduced if your AGI is between: Your deduction is eliminated if your AGI is: Single or head of household $45,000-$55,000 $55,000 or more Married filing jointly or qualifying widow(er) $65,000-$75,000 $75,000 or more Married filing separately $0-$10,000 $10,000 or more You may also qualify for a partial tax credit for amounts contributed to your traditional IRA or your 401(k) plan. The credit is available to certain taxpayers in tax years 2002-2006.