Tax Tip: Roth IRA Contribution Rules

Confused about whether you can contribute to a Roth IRA? Check these simple rules:

Income:
To contribute to a Roth IRA, you must have compensation (e.g., wages, salary, tips, professional fees, bonuses). Your modified adjusted gross income must be less than:

  • $160,000 — Married Filing Jointly
  • $10,000 — Married Filing Separately (and you lived with your spouse at any time during the year)
  • $110,000 — Single, Head of Household, or Married Filing Separately (and you did not live with your spouse during the year).

Age:
There is no age limitation for Roth IRA contributions. Unlike traditional IRAs, you can be any age and still qualify to contribute to a Roth IRA.

Contribution Limits:
In general, if your only IRA is a Roth IRA, the maximum 2003 contribution limit is the lesser of your taxable compensation or $3,000 ($3,500 for those age 50 or over). The maximum contribution limit phases out if your modified adjusted gross income is within these limits:

  • $150,000-$160,000 — Married Filing Jointly
  • $0-$10,000 — Married Filing Separately (and you lived with your spouse at any time during the year)
  • $95,000-$110,000 — Single, Head of Household, or Married Filing Separately (and you did not live with your spouse)

Contributions to Spousal Roth IRA:
You can make contributions to a Roth IRA for your spouse provided you meet the income requirements.

When to Make Contributions?
Contributions to a Roth IRA can be made at any time during the year or by the due date of your return for that year (not including extensions).

For complete information and definitions of terms, get IRS Publication 590, "Individual Retirement Arrangements." Download the publication from their Web site or call toll free 1-800-TAX-FORM (1-800-829-3676) to request a free copy of the publication.


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