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For Which Year(s) Are You Covered?: IRA Contributions and Transfers (2025 IRS Guide)

This guide covers “For Which Year(s) Are You Covered?” within ira contributions and transfers. The following material presents the IRS treatment of this topic, including the qualifications, exceptions, and examples in the source section. Read the rules alongside the facts of your own situation before deciding what to report, deduct, or document.

Adapted from Publication 590-A (2025), Contributions to Individual Retirement Arrangements (IRAs), published by the Internal Revenue Service. This guide retains the source edition’s years, amounts, deadlines, and examples. It is guidance for that edition, not a statement that the same figures apply to every tax year.

Context for these rules

The Form W-2 you receive from your employer has a box used to indicate whether you were covered for the year. The “Retirement plan” box should be checked if you were covered.

Reservists and volunteer firefighters should also see Situations in Which You Aren’t Covered, later.

If you aren’t certain whether you were covered by your employer's retirement plan, you should ask your employer.

For Which Year(s) Are You Covered?

Special rules apply to determine the tax years for which you are covered by an employer plan. These rules differ depending on whether the plan is a defined contribution plan or a defined benefit plan.

Tax year.

Your tax year is the annual accounting period you use to keep records and report income and expenses on your income tax return. For almost all people, the tax year is the calendar year.

Defined contribution plan.

Generally, you are covered by a defined contribution plan for a tax year if amounts are contributed or allocated to your account for the plan year that ends with or within that tax year. However, also see Situations in Which You Aren’t Covered, later.

A defined contribution plan is a plan that provides for a separate account for each person covered by the plan. In a defined contribution plan, the amount to be contributed to each participant's account is spelled out in the plan. The level of benefits actually provided to a participant depends on the total amount contributed to that participant's account and any earnings and losses on those contributions. Types of defined contribution plans include profit-sharing plans, stock bonus plans, and money purchase pension plans.

Example.

Company A has a money purchase pension plan. Its plan year is from July 1 to June 30. The plan provides that contributions must be allocated as of June 30. An employee leaves Company A on December 31, 2024. The contribution for the plan year ending on June 30, 2025, is made February 15, 2026. Because an amount is contributed to the employee’s account for the plan year, this employee is covered by the plan for their 2025 tax year.

Note:

A special rule applies to certain plans in which it isn’t possible to determine if an amount will be contributed to your account for a given plan year. If, for a plan year, no amounts have been allocated to your account that are attributable to employer contributions, employee contributions, or forfeitures, by the last day of the plan year, and contributions are discretionary for the plan year, you aren’t covered for the tax year in which the plan year ends. If, after the plan year ends, the employer makes a contribution for that plan year, you are covered for the tax year in which the contribution is made.

Example.

You were covered by a profit-sharing plan and left the company on December 31, 2024. The plan year runs from July 1 to June 30. Under the terms of the plan, employer contributions don’t have to be made, but if they are made, they are contributed to the plan before the due date for filing the company's tax return. Such contributions are allocated as of the last day of the plan year, and allocations are made to the accounts of individuals who have any service during the plan year. As of June 30, 2025, no contributions were made that were allocated to the June 30, 2025, plan year, and no forfeitures had been allocated within the plan year. In addition, as of that date, the company wasn’t obligated to make a contribution for such plan year, and it was impossible to determine whether or not a contribution would be made for the plan year. On December 31, 2025, the company decided to contribute to the plan for the plan year ending June 30, 2025. That contribution was made on February 15, 2026. You are an active participant in the plan for your 2026 tax year but not for your 2025 tax year.

No vested interest.

If an amount is allocated to your account for a plan year, you are covered by that plan even if you have no vested interest in (legal right to) the account.

Defined benefit plan.

If you are eligible to participate in your employer's defined benefit plan for the plan year that ends within your tax year, you are covered by the plan. This rule applies even if you:

  • Declined to participate in the plan,

  • Didn’t make a required contribution, or

  • Didn’t perform the minimum service required to accrue a benefit for the year.

A defined benefit plan is any plan that isn’t a defined contribution plan. In a defined benefit plan, the level of benefits to be provided to each participant is spelled out in the plan. The plan administrator figures the amount needed to provide those benefits, and those amounts are contributed to the plan. Defined benefit plans include pension plans and annuity plans.

Example.

You are an employee of Company B and are eligible to participate in Company B's defined benefit plan, which has a July 1 to June 30 plan year. You leave Company B on December 31, 2024. Because you are eligible to participate in the plan for its year ending June 30, 2025, you are covered by the plan for your 2025 tax year.

No vested interest.

If you accrue a benefit for a plan year, you are covered by that plan even if you have no vested interest in (legal right to) the accrual.

Using the guidance

Keep the documents that establish the dates, amounts, and circumstances described above. References to other chapters, forms, worksheets, or earlier and later sections refer to the linked IRS publication. Check the full publication and its updates before relying on a rule for a different tax year or a situation not addressed here.

Sources and further reading

The cited U.S. government text is in the public domain. Source accessed October 28, 2026. Fynoptic has organized this material for educational use and is independent of, and not endorsed by, the IRS.

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