2010 Traditional and Roth IRA Contribution Limits
The contribution limit for IRA did not change for 2010. Like 2009, the maximum you may contribute to your Traditional and Roth IRAs combined is $5,000. If you are 50 years and older, your contribution limit is $6,000 (due to $1,000 catch-up contribution allowance). Note this is a per individual limit and as a married couple, the contribution limits are effectively $10,000 to $12,000 combined.
It’s important to know that the limit applies to the combination of both Traditional and Roth IRA. In other words, you can contribute up to $5,000 in any combination. For example, if you contribute $3,000 to Traditional IRA, you can only contribute $2,000 to Roth IRA — not $5,000 each.
The follow tables show the contribution limits for IRA, along with the catch-up contribution amount for individuals 50 and older:
Contribution Limits for Traditional IRA and Roth IRA
| Year | Contribution Limit | Catch-up |
|---|---|---|
| 2009 | $5,000 | $1,000 |
| 2010 | $5,000 | $1,000 |
Phase Out for Traditional IRA and Roth IRA
There are phase out limits on IRA contribution depending on your income tax filing status, and you may not contribute up to the $5,000 maximum contribution limit. The phase out limits are based on your Modified Adjusted Gross Income (MAGI), which is calculated on your tax form. Roth IRA eligibility begins phasing out with a MAGI above $105,000 for single filers, and above $167,000 for married filing jointly (up $1,000 from 2009). Single filers with a MAGI above $120,000 and married filing jointly with a MAGI above $177,000 (up $1,000 from 2009) are not eligible for Roth IRA contributions.
For Traditional IRA, the phase out begins at $55,000 and ends at $65,000 for single filers, and from $89,000 to $109,000 for married filing jointly. Please note that you can still contribute to a Traditional IRA if your MAGI is above the phase out limits; however, you will not be able to deduct your contributions for tax purpose.
| IRA Type | Single | Married Filing Jointly |
|---|---|---|
| Roth IRA | $105,000 – $120,000 | $167,000 – $177,000 |
| Traditional IRA | $55,000 – $65,000 | $89,000 – $109,000 |
If you have not contribute the maximum amount to IRA for 2009, you still have until April 15, 2010 to do so.
Conclusion
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Roth IRA eligibility, maximum contribution, tax filing status, Phase Out Limit, IRA, IRA contributionsRecommended articles
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I keep advising this to people….I wouldn’t necessarily jump to converting to Roth IRA. With the recent economic situation I would actually advise against any cash investments. Instead I would look into hard assets, things like gold, land even real estate. They will hold their value a lot better over time.
But anyway, I would advise anyone to read up a bit on Roth IRA before you make any changes with your retirement plan. More in contribution limits here: http://www.rothirarules.net/ro.....limits.htm