Traditional and Roth IRA Contribution Limits

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I know this is somewhat elementary stuff but I’ve been getting a lot of searchers looking for these contribution limits and they’re going to pages that don’t display it in a convenient and easily scannable format – thus, I’ve written this entirely new post to address these limits.

Contribution Limits:

Year Under 50 Limit Over 50 Limit
2006-2007 $4,000 $5,000
2008 $5,000 $6,000
2009 $5,000 $6,000
2010 $5,000 $6,000

Roth IRA Income Phase-out:

Year Floor Ceiling
2008 Single $101,000 $116,000
2008 Married F.J. $159,000 $169,000
2009 Single $105,000 $121,000
2009 Married F.J. $166,000 $176,000
2010 Single $106,000 $121,000
2010 Married F.J. $167,000 $177,000

Some rules:

  • The Over 50 Limit takes into account a catch-up contribution you’re allowed to make if you turned 50 at any point during the year, so if you turned 50 on December 31st, then you’re allowed to contribute the Over 50 Limit. Your contribution is also limited by your income, you are permitted to contribute the lesser of your income or the limit (so if you made $500 in income, you’re only allowed to contribute $500 to your IRA).
  • Traditional and Roth IRAs share the same limits, thus if you contribute $1,000 in 2008 to your Traditional IRA, you may only contribute an additional $3,000 to your Roth IRA (assuming you’re under 50).
  • The Roth IRA income phase-out is linear, so if you are Married Filing Jointly, under 50, and your total income were $164,000 (2008), you are permitted to contribute $2,500 to your Roth IRA. There are two special cases though: 1) when calculating your limit, round up to the nearest $10; 2) If your limit is under $200 but still positive, round up to $200.
{ 46 comments, please add your thoughts now! }

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46 Responses to “Traditional and Roth IRA Contribution Limits”

  1. Lisa says:

    I have $3200 nondeductiable T-IRA, total $4000 T-IRA. My T-IRA income at the end of 2007 is $4700. I converted $4000 T-IRA to Roth IRA in 2007. Can I still contribute another $4000 into R-IRA? Thanks.

  2. Ron says:

    I understand that if I now put in the full amount (non-deductable) in a 2008 Roth IRA ($6000 as am over 50), but it turns out by the end of the year I have earned within the phase-out band or over the maximum ceiling for investing in a Roth IRA, I will need to recharacterize. What is the downside for gambling I will be able to make the Roth IRA investment as opposed to a Traditional IRA; that is, what is the penalty – lost income, interest, penalty, etc. – of needing to recharacterize?

  3. Cathie says:

    Just to verify what I am reading. Regardless of how much income we make in 2008 (lets exaggerate and say $300,000 MAGI) both my husband and I (both 50 years old in 2008) can make a $6,000 non-deductible contribution each to our traditional IRAs for 2008. Then in 2010 we can convert the momey to a Roth?

  4. jim says:

    Cathie – According to the law as it exists today, that is correct to the best of my knowledge.

  5. Lorenzo says:

    If you fund a simple IRA at $5000 and later in the year realize you can now fund it at $6000 because you turned 50 that year, can you put an additional $1000 in at ANOTHER institution (i.e, JP Morgan Chase IRA for the $5000 and Citibank IRA for the $1000 catch up). OR do you have to put the additional $1000 at the same institution (JP Morgan Chase in this example).

  6. Michael Fischer says:

    Does a 403B contribution, or 401K contribution in 2008 have any effect on what I can contribute to a Roth IRA ?

    • jim says:

      They do not share the same contribution limits. They do affect one another in that when you contribute to a retirement account, your gross income is lowered and you could potentially contribute more to a Roth IRA if you’re in the income phase out region.

  7. Michael says:

    I usually try to fund my Roth IRA at the beginning of each year based on the latest tax return filed. My income tax return had me below the phase-out limit in 2006, but near the end of 2007 I had a promotion and increase. As it was the end of 2007, not much change to 2007 AGI, but 2008 reflects the entire year’s income change and puts me over the phase-out limit.

    Because I fund the IRA in January, the previous year’s tax return is not yet filed so I use the year’s before to check the income (with assumed increases) against phase-out limits.

    If I did contribute to 2008 in January, based on 2006 Tax Return + assumed increase, and I am over the limit for 2008, what do I need to do?

  8. JJ says:

    Which the IRA(Roth or Traditional) that I should fund first if married filed jointly with AGI around $159,000 in 2008? I guess Roth. Am I right? What if I can contribute $4000 to Roth IRA after taking phase out into consideration, can I contribute the remaining $1000 to a traditional IRA for 2008 so that my total IRA contribution for 2008 is below the $5000 limit?

  9. Anonymous says:

    I made a Roth IRA contribution and now I find out I’m above the AGI limit to contribute. Can I withdraw the contribution as if it never happened and put the money somewhere else?

  10. sammamish says:

    By 2010

  11. Anonymous says:

    we had no earned income in 2008, and are converting $100k of traditional IRAs to Roth IRAs. we originally thought that the entiure $100k would be claimed as taxable income.

    but some of the original IRA contributions were not deductible (they were post-tax)- can you point me to a table of maximum contributions that goes back to the beginning of IRAs? if we can separate the nature of the contributions then we should only have to claim income of the pretax contributions and 100% of the gains – correct?

    I can only find maximum contributions back to 2002, but need many earlier years.

    hope you can help.

  12. Joe says:

    For those asking, your total contribution to ALL IRA accounts cannot exceed the limits imposed by the IRS. If your limit is $5000, you can split it among your IRA accounts, but you can’t exceed $5000 total even if you have several accounts. There are penalties for contributing too much to your IRA accounts, so it’s not advisable unless you think your contributions can outperform the amount of penalty you’ll pay.

  13. @Anonymous – In regard to an excess Roth IRA contribution (your income rose above the threshold after you contributed), you need to get a “Distribution Request Form” from the IRA custodian (broker) who hosts your account. Fill out the form and return it to your broker. They should refund you the full amount of your original contribution. Save a copy of the form for your tax records.

    Excess Roth IRA contributions incur a 6% annual penalty until the excess contribution is removed. However, the IRS does give you a decent time window in which to rectify the situation. As long as you fix things in a timely manner, you should be fine. Just make sure you document your excess contribution withdrawal.

  14. JZ says:

    Under this setup, why would any married double-income couple want to file jointly?

  15. Anonymous says:

    I contributed to both a Simple and to a Roth in 2006. I over contributed by $3400. I just realized this today! In IRS Pub 590, the Traditional IRA section, it sounds like I can apply the excess to “later years”. Does this mean I can call the mutual fund company and ask them to reapply the $3400, split between 2009 and 2010? Does this mean I avoid the 6% excise penalty?


  16. Paul H. says:

    In 2009 I rolled over $2200 from my bus driver pension account into my traditional IRA account. I also contributed 2800 cash into the account. Question: Can I still contribute $2200 into the account for tax year 2009 OR does my bus driver pension rollover count against the $5000 limit ?

  17. quick says:

    I realize that if I were to contribute to both a Roth IRA and a traditional IRA, the total contribution can’t exceed $5000 (under 50). But my MAGI is in the phaseout range for the Roth… so my question is, can I still contribute $5000 total, or just up to the phaseout limit? Thanks!

  18. Lydia says:

    I am single mother of 2 and make less than 30K a year. What IRA is best for me.

  19. jg says:

    my only income this year is from traditional IRA distribution, which i understand is taxable income. i now have some unexpected cash (flow) but no income, can i contribute to my ira and have that deduction (in effect to offset the distribution which is taxable income)?

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