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IRA Contribution Reminder

The deadline to file your 2013 tax return is one month away! Here is a reminder to anyone who has either claimed a deduction for your 2013 IRA contribution or wants to make a non-deductible contribution.

The maximum amount that can be contributed for 2013 (2014 as well) is $5,500. If you are age 50 and above an additional $1,000 is allowed. This applies to both Traditional and Roth IRA’s.

Deductibility of an IRA contribution phases out at certain income levels, but a non-deductible contribution is still permitted. The ability to contribute any amounts directly to a Roth is phased out entirely at a certain income.

  • 2013 IRA Deductibility Limits
  • $59,000 – $69,000 – Singles
  • $95,000 – $115,000 – Married Filling Jointly
  • * If only 1 spouse is an active participant in a retirement plan
  • * Non-participant spouse phase out $178,000 – $188,000
  • 2013 Roth Contribution Limits
  • $112,000 – $127,000 – Singles
  • $178,000 – $188,000 – Married Filling Jointly
  • $0 – $10,000 – Married Filling Separate

The new year typically brings some changes to amounts and levels allowable for these types of contributions, and 2014 is no exception. The 2014 limits on contributions remained the same for both Traditional and Roth IRA’s ($5,500 and $1,000 catch up above age 50), but the phase out thresholds changed slightly.

  • 2014 IRA Deductibility Limits
  • $60,000 – $70,000 – Singles
  • $96,000 – $116,000 – Married Filling Jointly
  • * If only 1 spouse is an active participant in a retirement plan
  • * Non-participant spouse phase out $181,000 – $191,000
  • 2014 Roth Contribution Limits
  • $114,000 – $129,000 – Singles
  • $181,000 – $191,000 – Married Filling Jointly
  • $0 – $10,000 – Married Filling Separate

As always, be sure to consult with your financial planning professional to determine the best options for taking advantage of the tax deferred and/or tax free savings vehicles available to you.

Steve