IRA Contribution Limits & Income Phase-Out Limits for 2023 and 2024
The 2023 IRA contribution limit for (traditional and Roth IRAs) is the same at $6,500 if you're under age 50. The 2023 IRA catch-up contribution limit is $7,500 if you're age 50 or older.
The 2024 IRA contribution limit (for traditional and Roth IRAs) is $7,000 if you're under age 50. The 2024 IRA catch-up contribution limit is $8,000 if you're age 50 or older.
But, these contribution limits may be lower depending on your income and whether you have a traditional or Roth IRA.
IRA Income and Deduction Limits
Due to the difference in tax benefits from a traditional IRA and a Roth IRA, contribution limits are applied differently as well.
With a traditional IRA, you're allowed to deduct contributions. You can contribute up to the annual limit, but the maximum deduction may be reduced to $0 -- based on your income.
With a Roth IRA, your contributions are made with post-tax dollars. So, the maximum contribution may be reduced to $0 -- based on your income.
The income and deduction limits for traditional IRAs and Roth IRAs are based on your modified adjusted gross income:
2023 and 2024 Traditional IRA Deduction Limits (based on income)
| Filing status | Modified adjusted gross income in 2023 | Deduction limit for 2023 | Modified adjusted gross income in 2024 | Deduction limit for 2024 |
|---|---|---|---|---|
| Single individuals | $73,000 or less | The full amount contributed | $77,000 or less | The full amount contributed |
| $73,001 - $82,999 | Partial deduction | $77,001 - $86,999 | Partial deduction | |
| $83,000 or more | No deduction | $87,000 or more | No deduction | |
| Married filing jointly | $116,000 or less | The full amount contributed | $123,000 or less | The full amount contributed |
| $116,001 - $135,999 | Partial deduction | $123,001 - $142,999 | Partial deduction | |
| $136,000 or more | No deduction | $143,000 or more | No deduction | |
| Married filing separately | Less than $10,000 | Partial deduction | Less than $10,000 | Partial deduction |
| $10,000 or more | No deduction | $10,000 or more | No deduction |
2023 and 2024 Roth IRA Contribution Limits (based on income)
| Filing status | Modified adjusted gross income in 2023 | Contribution limit for 2023 | Modified adjusted gross income in 2024 | Contribution limit for 2024 |
|---|---|---|---|---|
| Single individuals | Less than $138,000 | $6,500 ($7,500 if age 50 or over) | Less than $146,000 | $7,000 ($8,000 if age 50 or over) |
| $138,000 - $152,999 | Partial contribution | $146,000 - $160,999 | Partial contribution | |
| $153,000 or more | No contributions | $161,000 or more | No contributions | |
| Married filing jointly | Less than $218,000 | $6,500 ($7,500 if age 50 or over) | Less than $230,000 | $7,000 ($8,000 if age 50 or over) |
| $218,000 - $227,999 | Partial contribution | $230,000 - $239,999 | Partial contribution | |
| $228,000 or more | No contributions | $240,000 or more | No contributions | |
| Married filing separately | Less than $10,000 | Partial contribution | Less than $10,000 | Partial contribution |
| More than $10,000 | No contributions | More than $10,000 | No contributions |
2023 IRA Contribution Deadline
The 2023 IRA contribution deadline is Monday, April 15, 2024.
It is often known as "Tax Day" -- the same day as the deadline for filing your 2023 tax return.
2024 IRA Contribution Deadline
The 2024 IRA contribution deadline is Tuesday, April 15, 2025.
Again, this is the same day that standard tax returns are due.
What If You Contribute Over the Limit?
Many people find that they've overcontributed to their IRAs if their income increased significantly or their tax-filing status changed during the year.
If you contributed over your limit before filing your tax return, you can simply withdraw the excess amount.
Remember:
With a traditional IRA, you can still contribute the maximum for the year, but you cannot get the full deduction.
If you contributed over your limit after filing your tax return, there are two ways to fix it:
- Withdraw the excess contribution and any earnings. Then, file an amended tax return by October 15.
- Reduce your contributions for the next year by the overcontributed amount. You will pay a penalty of 6% on the overcontributed amount for each year that the excess contribution isn't addressed.
Historical IRA Contribution Limits
| Tax Year(s) | Contribution Limit (under age 50) | Catch-up Contribution Limit (age 50+) |
|---|---|---|
| 2024 | $7,000 | $8,000 |
| 2023 | $6,500 | $7,500 |
| 2022 | $6,000 | $7,000 |
| 2021 | $6,000 | $7,000 |
| 2020 | $6,000 | $7,000 |
| 2019 | $6,000 | $7,000 |
| 2013-2018 | $5,500 | $6,500 |
| 2008-2012 | $5,000 | $6,000 |
| 2005-2007 | $4,000 | $4,500 |
| 2002-2004 | $3,000 | $3,500 |
| 1982-2001 | $2,000 | - |
| 1974-1981 | $1,500 | - |
How to Choose Between a Traditional vs. Roth IRA
Choosing between a traditional and Roth IRA depends entirely on your circumstances and outlook.
If you qualify for both account types, the main difference is the tax advantage you receive for contributing to these accounts.
Traditional IRA contributions may offer you a deduction today. That means you don’t pay taxes on the money you contribute if you qualify.
Unfortunately, you must eventually pay taxes. When you withdraw money in retirement, you must pay ordinary income taxes on all amounts withdrawn.
These account types may be a good fit if you expect the tax rates you pay now to be higher than the tax rates you’ll pay in retirement.
Roth IRAs work differently. You don’t get a deduction today for contributing to these accounts. Instead, you get to take qualified withdrawals tax-free in retirement as long as you follow the rules.
These accounts may be a better fit for those that expect tax rates to be higher in retirement than they are today. This way, you pay the taxes now and never pay taxes again assuming you follow the rules and laws don’t change.
While this is a simplified look at how to decide, there are other factors to consider. You should consult with a fee-only fiduciary financial advisor if you’re unsure which account is best for you.
Is it possible to contribute to both types in the same year?
You can contribute to both a traditional and a Roth IRA in the same year, assuming you qualify.
The $6,000 contribution limit, or $7,000 for those age 50 or older, applies to all IRAs.
This means you cannot contribute $6,000 to a traditional IRA and another $6,000 to a Roth IRA.
You could contribute $4,000 to a traditional IRA and $2,000 to a Roth IRA, if you qualify.
Don’t Forget About Other Retirement Plans
While investing in an IRA may be a smart move for your situation, don’t forget about the other retirement plans you have access to. If your workplace offers a retirement plan, it may give you additional opportunities to invest even more money in a tax-advantaged manner.
Self-employed individuals and small business owners may also be able to set up their own retirement plans. These can offer the ability to put away large sums of money depending on which type you decide to set up.
If you need help figuring out how to maximize your tax-advantaged savings, consider consulting a fee-only fiduciary financial advisor for help. They can create a financial plan to help you meet your retirement saving and other financial goals. They may even identity other saving opportunities, such as the saver credit.
Frequently Asked Questions
How do catch-up contributions work?
If your brokerage firm supports them, catch-up contributions simply increase the contribution limit for the year.
In 2022 and 2023, you qualify for catch-up contributions if you’re age 50 or older.
This increases your potential maximum IRA contribution limit from $6,000 to $7,000 for 2022 and from $6,500 to $7,500 for 2023, respectively.
Do I need earned income to contribute to an IRA?
To make a contribution to a traditional IRA or Roth IRA, you need earned income.
Earned income is the name for income reported on a Form W-2 as wages or reported as self-employment income that you pay self-employment taxes on.
Without earned income, you generally can’t contribute to an IRA.
Even so, you may qualify for a spousal IRA if you’re married.
How do spousal IRA contributions work?
A spousal IRA is a special exception that allows a spouse without earned income to contribute to a Roth or traditional IRA.
For this to work, a married filing jointly couple can have a spouse with earned income contribute to an IRA for a spouse without earned income.
The spouse with earned income must have enough earned income to cover both their own contributions and their contributions to their spouse’s account.
