If you are looking for the income limits that will apply to 2012 (for when you are doing taxes next year), please visit our article on the 2012 Roth IRA Income limits instead.
This post will cover any and all updates to your 2013 Roth IRA Income Limits. The limits set on your income by the Internal Revenue Service (IRS) are adjusted every few years to accommodate things like inflation that reflect the state of the economy. The income limits are a very important part of determining your 2013 Roth IRA Contribution Limits.
The reason it is important for you to accurately understand what restrictions your income put on your account is because of penalties that you can face if you contribute too much.
Quick Recap of Factors Affecting Limits
Like always there will be 3 main categories that you can fall into: Single, Married, and Married but separated. If you have been separated for over a year than you will fall under the Single category again. Remember that if you fall in-between the lower and upper limits you will only be able to contribute a reduced amount.
Before you start make sure you have at least a rough idea of your modified adjusted gross income (MAGI), in most cases a rough idea is all you need, but if you are close to a limit you will have to determine a specific MAGI first.
Roth IRA Income Limits 2013
As of now, the official income limits for 2013 have been released by the IRS, and all the following information is up to date.
- The lower cutoff for singles in 2012 was $110,000, which meant if you had a MAGI less than this amount you had the potential to contribute the maximum; the lower cutoff has risen in 2013 to $112,000. Likewise, the upper limit (where you are not allowed to contribute at all if your income exceeds it) is $127,000 in 2013.
- The lower cutoff as discussed above for married couples was $173,000 in 2012. This amount is the sum of both partner’s MAGI and if you make less you are able to fully contribute to your Roth IRA. The upper limit was $183,000, and if your combined MAGI were in-between that amount you would be able to contribute, but just a reduced amount. The lower and higher cutoff values in 2013 are $178,000 and $188,000 respectively.
- Finally, the last filing option you have is filing married but separated. If you recall, this is the strictest category for filing because the IRS wants to make sure people are not abusing the system. The cutoff remains the same as in 2012 which was $10,000. If your MAGI is more than this you will not be allowed to contribute. If you make less than you are able to contribute up to your maximum, unfortunately you probably won’t have much available.
So there you have it, all the current information on your Roth IRA Income Limits 2013, check back any time for the most up to date information.