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The Roth IRA Contribution Phaseout for 2006 and 2007
By JLP | December 7, 2006
For 2006, the Roth IRA contribution phaseout is as follows:
Filing Status: Married Filing Jointly & Qualifying Widow(er)
The phaseout based on your modified adjusted gross income (MAGI) is $150,000 - $160,000
Filing Status: Single, Head of Household, or Married Filing Separately
The phaseout, again based on your modified adjusted gross income (MAGI) is $95,000 - $110,000
If your MAGI is below the low end of the phaseout, you can make a full contribution. If your MAGI falls within the phaseout, your contribution will be reduced. If your MAGI is above the upper limit of the phaseout, you cannot contribute to a Roth. However, you can still contribute to a non-deductible Traditional IRA, which you might be able to convert to a Roth IRA in the future.
For 2007, the Roth IRA contribution phaseout is EXPECTED to be the following:
Filing Status: Married Filing Jointly & Qualifying Widow(er)
The phaseout based on your modified adjusted gross income (MAGI) is $156,000 - $166,000
Filing Status: Single, Head of Household, or Married Filing Separately
The phaseout, again based on your modified adjusted gross income (MAGI) is $99,000 - $114,000
It’s good to see them raise the phaseout threshhold. Personally, I think it is silly to have a phaseout in the first place since the MOST a person can contribute is $4,000 ($5,000 if over age 50).
Topics: IRAs, Retirement Planning, Roth IRA, Tax Planning, Taxes |