For 2010 and 2011, the most that an individual can contribute to a traditional IRA or Roth IRA generally is the smaller of: $5,000 ($6,000 if the individual is age 50 or older), or the individual’s taxable compensation for the year. You have until your taxes are due (April 15th, 2011) to add to your IRA for 2010.
This is the most that can be contributed regardless of whether the contributions are to one or more traditional or Roth IRAs or whether all or part of the contributions are nondeductible. However, other factors may limit or eliminate the ability to contribute to an IRA as follows:
- An individual who is age 70½ or older cannot make regular contributions to a traditional IRA (just to make things complicated you can add to a Roth IRA) for the year.
Contributions to a Roth IRA are limited based on income. The limits are based on modified adjusted gross income (which is before deductions are taken). The Roth IRA earnings limits for 2010 are:
- Single filers: Up to $105,000; from $105,000 – $120,000 (a partial contribution is allowed)
- Joint filers: Up to $167,000; from $167,000 – $177,000 (a partial contribution)
For 2011 the earning limits increase to
- Single filers: Up to $105,000; from $107,000 – $122,000 (a partial contribution is allowed)
- Joint filers: Up to $167,000; from $169,000 – $179,000 (a partial contribution)
The income limits do not cap what you can add using a 401(k). So if you were planning on adding to a Roth IRA but cannot due to the income limits you may want to look into increasing your 401(k) contributions.