Roth IRA Contribution Limits and Income Phaseout Schedule
September 28th, 2006 | Published in Investing
The Roth IRA contribution limits are:
| Year | 49 And Under | 50 And Over |
|---|---|---|
| 2005 | $4,000 | $4,500 |
| 2006-7 | $4,000 | $5,000 |
| 2008 | $5,000 | $6,000 |
As you can see, if you’re over 50 then you’re given a “catch-up” contribution.
The income phaseout schedule is based on your modified adjusted gross income, which is your income minus some deductions. The income phaseout schedule is:
| Filing Status | Income Floor | Income Ceiling |
|---|---|---|
| Single, Head of Household | $95,000 | $110,000 |
| Married Filing Separately | $0 | $10,000 |
| Married Filing Jointly | $150,000 | $160,000 |
The phaseout is linear, so if you are single then at $95,000 then you could contribute $4,000 in 2006. If you made $110,000 then your contribution is $0. If you made $100,000, then your contribution would be limited to $1333.33.
One little known fact: If you’re under the income ceiling, your phaseout’s minimum contribution is $200. So, if your MAGI were $109,999, your contribution limit is $200, not some miniscule proportionate number.
