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IRA Center
This is the internet’s source for information on Retirement Accounts
for beginners and professionals. The following information covers traditional IRAs, roth IRAs, 401(k)s, 401(k)
rollovers, SIMPLE IRAs, SEP IRAs, 403(b)s, SARSEPs, Keoghs, Pension Plans. Do you participate in a retirement plan
through your employer? You may be illegible to start a Traditional or Roth IRA as well.
ROTH IRA
The following page gives the IRS definition of a Roth IRA and also defines who is eligible to contribute to
a Roth IRA. The IRS determines eligibility based on taxable compensation, income, age, and participation in other
retirement plans.
The Roth IRA is not a traditional IRA, a SIMPLE IRA, or an education IRA. Neither a SEP-IRA nor a SIMPLE
IRA can be designated as a Roth IRA. Unlike a traditional IRA, you cannot deduct contributions to a Roth
IRA. But, if you satisfy the requirements, qualified distributions are tax free. Contributions can
be made to your Roth IRA after you reach age 70 1/2 and you can leave amounts in your Roth IRA as long as you live.
Here are some of the benefits of a Roth IRA:
- Maximum contribution = $2,000 per individual ($4,000 per couple).
- Lets your investments grow tax-free.
- Contributions can continue after age 70 1/2, and minimum distributions aren't required.
- Withdrawals on principle invested (not gains) without 10% penalty or income taxes.*
- Funds passed to beneficiaries are free from income taxes.
* Pending legislation may change this provision
for distributions taken from Roth Conversion IRAs.
Can I Contribute to a Roth IRA
Generally, you can contribute to a Roth IRA if you have taxable compensation and you do not exceed the
modified AGI (adjusted gross income) based on your filing status. Click
here to determine if you can contribute to a Roth IRA based on your filing status.
Can I Contribute to a Roth IRA for my Spouse?
You can contribute to a Roth IRA for your spouse provided the contributions satisfy the spousal IRA limit and you
do not exceed the modified AGI (adjusted gross income) based on your filing status. Click here to determine if you can contribute to a Roth IRA based on your filing
status. Click here for more information
on Spousal contributions.
How Much can I Contribute?
The maximum contribution limit per individual to a Roth IRA is $2,000 ($4,000 per couple). However, the maximum
contribution limit may be reduced by any contributions made to a traditional IRA (but not a SEP-IRA, SIMPLE IRA,
or employer sponsored plan) or limited by your modified AGI based on your filing status. Click here to determine if you can contribute
to a Roth IRA based on your filing status. If your modified AGI is above a certain amount, your maximum contribution
limit is gradually reduced. Click here
to figure out your reduction.
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