Traditional IRA and Roth IRA Contribution Limits

Understanding Current and Historical IRA Contribution Limits

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There's a limit to how much you can contribute to an IRA in a given year. Traditional and Roth IRA contribution limits typically increase with the inflation rate in $500 increments.

The contribution limit doesn't increase in some years if inflation wasn't significant enough to trigger the next increment. An investor can contribute to either a traditional or Roth IRA or split their contributions between the two, but the combined annual contribution can't exceed the overall limit.

The maximum you can contribute across all IRAs is $6,000 for 2020 and 2021. You can make an additional catch-up contribution of up to $1,000, for a total of $7,000 if you're age 50 or older.

IRA contributions are separate from 401(k) contributions, which have a significantly higher limit.

Traditional IRA and Roth IRA Contribution Limits

This chart details historical traditional IRA and Roth IRA combined contribution limits. The two columns represent the combined contribution age limits for those 49 years old or younger, and those 50 years or older.

2002-2004 $3,000 $3,500
2005 $4,000 $4,500
2006-2007 $4,000 $5,000
2008 $5,000 $6,000
2009 $5,000 $6,000
2010 $5,000 $6,000
2011 $5,000 $6,000
2012 $5,000 $6,000
2013 $5,500 $6,500
2014 $5,500 $6,500
2015 $5,500 $6,500
2016 $5,500 $6,500
2017 $5,500 $6,500
2018 $5,500 $6,500
2019 $6,000 $7,000
2020 $6,000 $7,000
2021 $6,000 $7,000

Traditional IRA contribution limits and Roth IRA contribution limits are written into the U.S. tax code so that they're always identical. 

Traditional IRA Deduction Limits

Your contributions aren't limited if you're covered by a retirement plan at work but your tax deductions could be, depending on your income. The income limits are also based on filing status.

For example, single filers with a modified adjusted gross income (AGI) of $65,000 in 2020 can deduct their full contribution to a traditional IRA. Married joint filers can take a full deduction if their income is $104,000 or less, but those who are married and filing separately can only make a partial deduction if their income is less than $10,000.

Single filers with a modified AGI of $66,000 can deduct their full contribution in 2021. Married joint filers need an income of $105,000 or less, and those married filing separately need an income of less than $10,000.

There's no deduction limit if you're single and you don't have a retirement plan at work, or if you're married and your spouse doesn't also have a retirement plan. Your deduction might be limited depending on your income if your spouse has access to a retirement plan.

Roth IRA Contribution Limits

Roth IRA contributions are limited based on income. For example, if you're married and filing jointly, your income must be less than $196,000 in 2020 to make a full contribution. If your income is more than $196,000, but less than $206,000, you can make a partial contribution, and if it's $206,000 or more, you can't contribute to a Roth at all.

Those who are married and filing jointly need an income less than $198,000 in 2021 to make a full contribution. Those with incomes between $198,000 and $208,000 can make a partial contribution, and those with incomes of $208,000 or more can't contribute to a Roth.

Single filers must make less than $124,000 in 2020 ($125,000 in 2021) to make a full contribution to a Roth IRA, and those married filing separately can't make a full contribution. They can only make a reduced contribution if their income is less than $10,000.

Contribution Deadlines

Neither traditional IRA nor Roth IRA contribution limits can be rolled forward to a future year. There's no option to increase the next year's limit if you don't reach the limit in one year.

The deadline for meeting the contribution limit is the initial tax filing deadline, tax day, which is usually April 15 unless this date falls on a weekend. For example, you would have until April 15, 2021 to fund your IRA account for the 2020 tax year unless there are changes to filing dates.

The IRS has extended the 2021 filing date from April 15 to May 15 due to the ongoing COVID-19 pandemic, but the contribution deadline remains at April 15, 2021, at least for now.

Ways of Funding Your IRAs

Contributions don't have to be made in one lump sum. You can set up an automatic contribution to your IRA once a week or once a month, or make other periodic contributions.

Assuming you meet the qualifications to contribute to a Roth, you could divvy up your contributions between a Roth and traditional IRA or you could put funds in just one or the other. A Roth offers tax-free withdrawals when you retire, while a traditional IRA offers tax deductions now. Both options have their advantages, and the best option for you depends on your priorities and overall financial situation.

Keep in mind that the combined annual contribution limit always applies. For example, you could contribute a total of $6,000 to either your traditional or Roth IRA without exceeding the contribution limits if you were 49 years old or younger in 2020. You could split it between the two types of accounts as long as you stay at or below the $6,000 total limit—$3,000 in each, for example. You couldn't, however, contribute $3,000 to a traditional IRA and $3,500 to a Roth, which would put you at a total of $6,500.

Exceptions to the Rule

Rollovers from one IRA to another don't count toward your annual contribution limits. You can rollover funds from an IRA of one type to another IRA of the same type. For example, you might move a traditional IRA from one trustee to another because you prefer the fees at the new trustee.

You can also convert a traditional IRA to a Roth IRA. This is referred to as a Roth conversion, and anything you convert could be counted as taxable income. You might want to roll over funds gradually over a few years to minimize taxes. You can't convert a Roth IRA into a traditional IRA.

Rollovers and contribution limits can be complex. It's best to consult a tax professional for tailored advice.