322
Tuesday, December 15, 2020

Roth IRA

The absolute maximum Roth IRA contribution is $5,500 per year. Remember that these numbers change each year, so be sure to double check that you have the right numbers before relying on them. These numbers are for the year 2018.

Eligibility

If you are single, and your modified adjusted gross income (MAGI) is below $120,000, you can contribute any amount up to the maximum.  If single with income above $135,000, you cannot contribute to a Roth IRA at all.  If your income is between those two number, you can contribute a partial amount (less than the maximum, calculated based on your income).

If married, a combined income below $189,000 allows the full contribution, and a combined income above $199,000 allows none.  Between those two numbers allows a partial contribution.

Benefits

Roth IRAs contain post-tax dollars (meaning you make deposits using money that you have already paid taxes on).