As we’ve previously discussed, IRAs are investment accounts retirement savers can use for the tax benefits. There are limits as to how much you can contribute to your IRAs each year. To accommodate for inflation, the IRS adjusts contribution and income limits for IRAs as needed. This is known as a cost-of-living adjustment. The IRS increased the 2024 IRA limits for contributions from $6,500 to $7,000. Additionally there are extra catch-up contributions for investors 50 or older.
2024 Roth IRA Income Limits
You can only contribute to a Roth if your Adjusted Gross Income (“AGI”) is below a certain threshold. The IRS refers to this threshold as the “Income Phase-Out” range. From the time you enter this range until you reach the top you can contribute less and less. Below is the income limits as well as the phase-out schedule for Single Filers as well as those Married Filing Jointly.
| Single Filer AGI | Married Filing Jointly AGI | Maximum Contribution for individuals under age 50 | Maximum Contribution for individuals age 50 and older |
|---|---|---|---|
| <$146,000 | <$230,000 | $7,000 | $8,000 |
| $147,500 | $231,000 | $6,300 | $7,200 |
| $149,000 | $232,000 | $5,600 | $6,400 |
| $150,500 | $233,000 | $4,900 | $5,600 |
| $152,500 | $234,000 | $4,200 | $4,800 |
| $153,500 | $235,000 | $3,500 | $4,000 |
| $155,000 | $236,000 | $2,800 | $3,200 |
| $156,500 | $237,000 | $2,100 | $2,400 |
| $158,000 | $238,000 | $1,400 | $1,600 |
| $159,500 | $239,000 | $700 | $800 |
| >$160,999.99 | >$239,999.99 | $0 | $0 |
From the chart you can see they left the catch-up contribution unchanged at an extra $1,000 for those age 50 or over. This is a nice opportunity for those approaching retirement to add a little more to their savings.
If you have any questions regarding an IRA or want to open an account contact us!
