How Much You Can Put Into a Roth IRA Each Year

Annual contribution limits for Roth IRAs

The amount you can put into a Roth IRA each year depends on your age and income. For 2024, you can contribute up to $7,000 if you are under 50, or $8,000 if you are 50 or older. These limits reset on January 1 each year. The IRS sets these numbers and adjusts them periodically for inflation, so the limit may change in future years.

The catch is that your income determines whether you can contribute the full amount, contribute less, or contribute nothing at all. The IRS calls this the "phase-out range"—a band of income where your allowed contribution shrinks as you earn more. Once your income exceeds the top of that range, you cannot contribute to a Roth IRA directly, though other strategies exist to work around this.

Income limits vary by filing status. If you file as single, the phase-out range for 2024 begins at $146,000 and ends at $161,000. If you file as married filing jointly, it begins at $230,000 and ends at $240,000. If you file as married filing separately, the range is much tighter: $0 to $10,000. These thresholds change each year, so check the current year's limits before you contribute.

Key Takeaways

• You can contribute $7,000 per year to a Roth IRA if you are under 50, or $8,000 if you are 50 or older, but only if your income falls within the allowed range.
• Your income determines your actual contribution limit; once you exceed the phase-out range for your filing status, you cannot contribute directly to a Roth IRA.
• The IRS adjusts contribution limits and income thresholds each year, so the numbers that applied last year may not apply this year.
• If your income is too high for a direct Roth contribution, a backdoor Roth conversion allows you to fund a Roth IRA through a traditional IRA.

How income limits reduce your contribution

If your income falls within the phase-out range, you cannot contribute the full amount. Instead, the IRS requires you to calculate a reduced contribution based on how far into that range your income falls. The math is straightforward but tedious: you divide the amount your income exceeds the lower limit by the width of the phase-out range, multiply by the full contribution limit, and subtract that from the full limit.

An example: suppose you file as single, earn $151,000, and are under 50. The phase-out range is $146,000 to $161,000—a span of $15,000. Your income is $5,000 above the lower limit. Divide $5,000 by $15,000 to get 0.33. Multiply 0.33 by $7,000 to get $2,310. Subtract $2,310 from $7,000 to get $4,690. You can contribute $4,690 that year. If the result is not a multiple of $50, round up.

The IRS publishes a worksheet in Publication 590-A to walk you through this calculation, or your tax software will do it for you. The key point is that the closer your income gets to the top of the phase-out range, the smaller your allowed contribution becomes.

What counts as income for the phase-out

The IRS uses modified adjusted gross income (MAGI) to determine whether you hit the phase-out range. MAGI is not the same as your adjusted gross income (AGI) on your tax return. For most people, MAGI and AGI are the same, but certain deductions—such as foreign earned income exclusion, foreign housing exclusion or deduction, and exclusion of Puerto Rico source income—are added back in.

If you are unsure whether your MAGI puts you in the phase-out range, calculate it first. Start with your AGI from your tax return, then add back any of those specific deductions if you claimed them. Your tax software or a tax professional can confirm your MAGI quickly.

One common surprise: if you have both a traditional IRA and a Roth IRA, your MAGI is calculated the same way for both. A large traditional IRA balance does not change your MAGI, but certain deductions do. Plan ahead if you are close to the income limit.

Contribution deadlines and catch-up contributions

You can contribute to a Roth IRA for a given tax year until the tax filing deadline for that year, which is usually April 15 of the following year. If you turn 50 during the year, you can make the catch-up contribution of an additional $1,000 for that year. You do not have to wait until the year you turn 50; you can make the catch-up contribution starting in the year you turn 50.

If you miss the deadline, you cannot go back and contribute for that year unless you file an amended return and the contribution was made before the deadline. The deadline is firm. If you have extra money in December and want to fund a Roth for the current year, you can do so until April 15. If April 15 has passed, that money goes toward the next tax year instead.

Backdoor Roth conversions when income is too high

If your income exceeds the phase-out range, you cannot contribute directly to a Roth IRA. However, you can use a backdoor Roth conversion to fund one indirectly. The process has two steps: first, contribute money to a traditional IRA (which has no income limit), then convert that traditional IRA to a Roth IRA.

The conversion itself is taxable if your traditional IRA contains pre-tax money. If you have no other traditional IRAs, SEP IRAs, or SIMPLE IRAs, and the money you are converting is the only money in the traditional IRA, you owe tax only on the earnings, not the contribution itself. If you have existing pre-tax balances in any traditional IRA, the conversion becomes more complicated because the IRS treats all your traditional IRAs as one pool for tax purposes.

A backdoor Roth works best if you have no other traditional IRA balances. If you do, consult a tax professional before attempting a conversion, because the tax bill can be substantial. The backdoor Roth is legal and widely used, but it requires careful execution to avoid mistakes.

Spousal Roth IRAs and joint filing

If you file as married filing jointly and one spouse has little or no income, that spouse can still open and fund a Roth IRA. The contribution limit for the lower-earning spouse is based on the couple's combined MAGI, not the individual spouse's income. However, the contribution cannot exceed the lower-earning spouse's actual earned income for the year.

For example, suppose you and your spouse file jointly with combined MAGI of $235,000. You earn $200,000 and your spouse earns $35,000. Your spouse can contribute up to $7,000 to their own Roth IRA (limited by their $35,000 earned income), and you can contribute up to $7,000 to your own Roth IRA. The phase-out range for married filing jointly is $230,000 to $240,000, so both of you are in the phase-out range. You would each calculate your reduced contribution based on the couple's combined MAGI of $235,000.

Contribution limits across multiple accounts

The annual contribution limit applies to all your Roth IRAs combined, not to each account separately. If you have two Roth IRAs at different financial institutions, your total contributions across both accounts cannot exceed $7,000 (or $8,000 if you are 50 or older) in a single tax year.

This rule prevents people from opening multiple Roth accounts to circumvent the limit. If you contribute $4,000 to one Roth IRA and $4,000 to another in the same year, you have exceeded the limit by $1,000. You would need to withdraw the excess and any earnings on it before the tax filing deadline to avoid a penalty.

If you accidentally over-contribute, the IRS charges a 6% excise tax on the excess amount for each year it remains in the account. Withdrawing the excess and any earnings before your tax filing deadline removes the penalty for that year, though you may owe income tax on the earnings portion.

Frequently Asked Questions

Can I contribute to a Roth IRA if I have no income?

No, you must have earned income to contribute to a Roth IRA. Earned income means wages, salary, self-employment income, or other compensation for work. Investment income, Social Security, pensions, and unemployment benefits do not count. If you are married and your spouse has earned income, a spousal Roth IRA may be an option.

What happens if I contribute more than the limit?

The excess contribution is subject to a 6% excise tax each year it stays in the account. You can withdraw the excess and any earnings on it before your tax filing deadline to avoid the penalty for that year. If you do not withdraw it, you will owe the 6% tax annually until the excess is removed.

Do I have to contribute the full amount every year?

No, you can contribute any amount up to your limit, or nothing at all. There is no requirement to contribute every year. If you have a low-income year, you can contribute less or skip that year entirely and catch up later if you wish.

Can I contribute to a Roth IRA and a traditional IRA in the same year?

Yes, but your combined contributions to both accounts cannot exceed the annual limit. If you contribute $4,000 to a Roth IRA, you can contribute only $3,000 to a traditional IRA that year (assuming the $7,000 limit). The limit applies across all IRAs you own, regardless of type.

What if my income changes after I contribute?

If your income ends up higher than you expected, you may have over-contributed. You can withdraw the excess and any earnings before your tax filing deadline to avoid the 6% penalty. If you discover the over-contribution after the deadline, you will owe the penalty, but you can still withdraw the excess in future years to stop the penalty from accruing further.