Small Roth IRA Changes for 2018
Did you happen to read IRS publication Notice 2017-64? Don’t worry, we read it for you. Each year, the IRS announces the contribution and income limits for the next calendar year. As has been the case in recent years, the changes for Roth IRAs (and Traditional IRAs) are relatively minor and only affect the income limits for 2018.
Contribution Limits Stay the Same
The total amount you can contribute to either a Roth IRA or a Traditional IRA remains unchanged at $5,500. People 50 and over can contribute an additional $1,000 for a total of $6,500.
Income Limits Adjusted Up $2,000-$3,000
Direct Roth IRA contributions are only allowed if your income (technically your Modified Adjusted Gross Income) is below a certain level (you can get around this limit by using a Backdoor Roth IRA). For single filers in 2018, that income threshold starts at $120,000 (up from $118,000) and ends at $135,000 (up from $133,000). In that range, your contribution is limited, eventually reaching zero. For married filing jointly filers (and qualifying widower(er)s in 2018, that income threshold starts at $189,000 (up from $186,000) and ends at $199,000 (up from $196,000).
|Roth IRA Contribution Limit||$5,500||$5,500|
|Roth IRA Contribution Limit if 50 or over||$6,500||$6,500|
|Traditional IRA Contribution Limit||$5,500||$5,500|
|Traditional IRA Contribution Limit if 50 or over||$6,500||$6,500|
|Roth IRA Income Limits (for single filers)||Phase-out starts at $118,000; ineligible at $133,000||Phase-out starts at $120,000; ineligible at $135,000|
|Roth IRA Income Limits (for married filing jointly and qualifying widow(er) filers)||Phase-out starts at $186,000; ineligible at $196,000||Phase-out starts at $189,000; ineligible at $199,000|
This information is not intended to be tax or legal advice, and it may not be relied
on for the purpose of avoiding any federal tax penalties. You are encouraged to seek
tax or legal advice from an independent professional advisor.