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Roth IRA Contribution Limits
By JLP | December 6, 2006
Don’t forget that if you haven’t contributed to your Roth IRA yet this year, you have until April 15, 2007 to make a 2006 contribution.
The maximum contribution for 2006 is $4,000 (or $5,000 if you are 50 years old or older). These amounts remain unchanged for 2007.
Who Can Contribute?
According to Publication 590 from the IRS:
Generally, you can contribute to a Roth IRA if you have taxable compensation (defined later) and your modified AGI (defined later) is less than:
$160,000 for married filing jointly or qualifying widow(er),
$10,000 for married filing separately and you lived with your spouse at any time during the year, and
$110,000 for single, head of household, or married filing separately and you did not live with your spouse at any time during the year.
There is a phaseout on Roth IRA contributions, based on your filing status and modified adjusted gross income (MAGI). The Roth IRA phaseout is:
For Married Filing Jointly or Qualifying Widow(er): $150,000 – $160,000
For Single Filers, Head of Household or Married Filing Separately: $95,000 – $110,000
If your modified adjusted gross income falls within the phaseout range you can still contribute to a Roth but at a reduced amount. The IRS website has a worksheet you can use to figure out your reduced contribution amount. There’s no direct link to the worksheet (although you can find it if you scroll down on this page) but it looks like this:
Topics: IRAs, Retirement Planning, Roth IRA, Tax Planning, Taxes | 1 Comment »
December 7th, 2006 at 1:22 am
It is nice see the limits going up, hope they continue to go up.
Good post