Q. I retired from the Defense Department on Dec. 31, 2009, and received my final paycheck in 2010. I purchased a traditional IRA for 2010, and claimed an income tax deduction for that IRA. I just received notice from the Internal Revenue Service that they have disallowed the deduction stating that according to my W-2 from DoD, I was covered by an employer retirement plan in 2010.
My agency payroll office tells me an amount of approximately $13 was added to my retirement account based on my final paycheck, which I received in 2010.
The IRS suggested I have my agency modify the W-2.
My agency says it does not have the authority to modify the W-2.
The reality is I was no longer a DoD employee. Do I have any options?
A. This is a question for a tax attorney or CPA — preferably one who will stand behind your tax return.
