One of the most newsworthy of messes in recent times was the Enron fiasco.
All eyes were in the workers who lost all of their retirement plan money due to Enron corporate impropriety.
The IRS, in an effort to assist these individuals and allow them some kind of Tax relief, made a provision in the Pension Protection Act.
This allows some workers to make larger than normal IRA contributions in order to make up for what was lost from the Enron company retirement accounts.
This law, named the `Enron IRA Catch-up Provision' allows for contributors to a 401(k) plan, whose employer became bankrupt in a previous year, able to contribute as much as $7 000 as apposed to the normal $4 000 or $5 000 limits.
Therefore if you are contributing $7 000 you will be able to enjoy Tax relief in this amount also.
Integral to this is the fact that your employer has to have been indicted or convicted in connection with the company's bankruptcy and have wiped out company retirement accounts.
This is the reason for the `Enron" nickname.
This law requires:

• Participation by you in a 401(k) plan whereby the employer matched 50% of your contribution to the plan with use of stock from the company.
  
• Participation by you in the 401(k) for at least six months prior to the owner of the business filing for bankruptcy.
  
• The controlling group or employer must have been a debtor during a bankruptcy case previously.
  

Individuals who are eligible for an `Enron' IRA option are also entitled to use the 50 or older add-on, and this will allow you to pay an extra $1 000 in your account as well as the already increased $7 000, allowing even more Tax relief.