nondeductible

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non·de·duct·i·ble

(nŏn′dĭ-dŭk′tə-bəl)

adj.

Not deductible, especially for income-tax purposes.

nondeductible

(ˌnɒndɪˈdʌktəbəl)

adj

(Accounting & Book-keeping) not able to be deducted

non•de•duc•ti•ble

(ˌnɒn dɪˈdʌk tə bəl)

adj.

1. not able to be deducted.

2. not allowable as a tax deduction.

[1940–45]

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Adj.

nondeductible - not allowable as a deduction

deductible - acceptable as a deduction (especially as a tax deduction)

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deductible

References in periodicals archive ?

Per IRS Publication 541, a partner's adjusted basis decreases for "partner's distributive share of nondeductible partnership expenses that are not capital expenditures.

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However, all eligible workers and spouses can make nondeductible contributions to a traditional IRA, regardless of income.

After-tax dollars in traditional IRAs

Rollovers, conversions, nondeductible contributions and inherited accounts can all have an impact on how distributions are taxed.

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The practical effect is that a taxpayer must recover any nontaxable amount (basis) ratably as distributions are received, by tracking basis on Form 8606, Nondeductible IRAs.

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The literal language of the section does not contain any carryover provision for nondeductible, noncapital expenses or for the oil and gas depletion deduction.

S corporation basis reductions for nondeductible expenses

So if you've maxed out your 401(k) or 403(b) contributions and don't qualify to make Roth IRA contributions because of your income level, you still can make nondeductible contributions to a traditional IRA in 2009 and 2010 and then convert it to a Roth IRA in 2010.

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Some owners, however, make nondeductible contributions to their IRAs that, if withdrawn, would be considered a tax-free return of nondeductible contributions.

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As important, there are a host of court decisions that provide guidance to distinguish between nondeductible fines and penalties and deductible amounts, such as restitution or other compensatory payments.

Comments on revenue offset provisions in Senate tax reconciliation bill: January 10, 2006

Examples include research and development tax credits, foreign income, nondeductible book accruals and tax carryover benefits.

Abuses Aside, Corporations Are Paying Their Tax Bills

At higher levels of income (of if you also have a Keogh or your spouse is covered by a pension), you have to decide whether a nondeductible IRA is worthwhile.

Financial savvy for the self-employed: planning ahead for your retirement can reap high rewards

However, clients may make nondeductible contributions to an IRA when adjusted gross income is too high to qualify for a tax deduction.