Can I have a Solo 401k plan and a traditional IRA at the same time?
Yes you can. However, the two are related in that if you are an active participant in a qualified plan (say, for example, a Solo 401k plan) limits are placed on the amount of a contribution to a traditional IRA that is deductible. For single individuals and heads of households, the part of the contribution to a traditional IRA that is deductible phases out ratably if MAGI is more than $45,000 and less than $55,000 in 2004. In 2005, it phases out ratably if MAGI is more than $50,000 and less than $60,000. However, the amount deductible will be at least $200 if the MAGI is less than the high end of the phase out range.
