The Roth IRA from may offer greater tax savings and withdrawal flexibility than a traditional IRA. Roth IRA accounts have no mandatory annual distribution requirements, and you can contribute beyond age 70-½. Eligibility depends on income.
Minimum to Open
April 17, 2018 for 2017 tax year
Tax free (earnings grow free of federal income tax)
Tax free (withdrawal of original contribution)
Potentially tax-free (withdrawal of earnings if part of a qualified withdrawal)
For single filers - up to $118,000 ($118,000-$133,000 for a partial contribution).
For joint filers - up to $186,000 ($186,000-$196,000 for a partial contribution).
For single filers - up to $120,000 ($120,000-$135,000 for a partial contribution).
For joint filers - up to $189,000 ($189,000-$199,000 for a partial contribution).
Annual Contribution Limit
You may contribute simultaneously to a traditional IRA and a Roth IRA (subject to eligibility) as long as the total contributed to all IRAs (traditional or Roth) is no more than $5,500 for the 2017 or 2018 tax years ($6,500 age 50 and older).
To determine your allowable contribution amount, please see chart below.
Withdrawal of contributions at any age, or earnings after age 59-½ and after account has been open for five years.
Withdrawal of earnings before age 59-½ or before your account has been open for at least five years.
Exceptions to penalty
Before five year holding period ends, subject to tax, or after five year holding period ends, not subject to tax, penalties are waived if you are over 59-½ or funds are withdrawn for:
* Five-year holding periods: There is a single five-year holding period when determining whether earnings can be withdrawn tax-free as part of a qualified distribution from a Roth contributory account. This period begins January 1 of the year of the first contribution to any Roth contributory account.
The chart below briefly describes the maximum allowable contribution amount to a Roth IRA for the category that applies to your household. Your eligibility to contribute to a Roth IRA is also subject to income limits.
|Allowable contribution amounts||
|Individuals under age 50||
|Individuals age 50 and older||
|Married under age 50 (both)||
|Married age 50 and older (both)||
-OR- 100% of earned income, whichever is less.
Eligibility Based on Annual Modified Adjusted Gross Income
Contributions are made on an after-tax basis, and can be made even if you contribute to a traditional IRA, including a Rollover IRA or SEP-IRA, or other employer-sponsored retirement plan.