2008 IRA Contribution Limits
By: Suzanne Lako
The Henssler Financial Group Position Paper
If you have not already made your Roth or deductible IRA contribution for 2008, you should do so. The longer the money has to grow, the better off you should be. If you do not receive a tax deduction for your Traditional IRA contributions, then those contributions may not be as beneficial as they once were. You should discuss your options with your financial adviser or tax consultant before making a Traditional IRA contribution.
To qualify to make a Roth or a Traditional IRA contribution, you must have earned income. The following lists the income limits and contribution limits for a Roth and a Traditional IRA:
Married Filing Jointly
- If your combined adjusted gross income (AGI) is more than $169,000, you cannot contribute to a Roth. Your contributions should be made to a Traditional IRA, depending on tax deductibility.
- If your AGI is between $159,000 and $169,000, the amount you may contribute to a Roth phases out the closer your income gets to $169,000. If your income falls in this range, discuss with your tax adviser the amount you may contribute to a Roth. The remainder could be contributed to a Traditional IRA, depending on deductibility.
- If your AGI is below $159,000, you may make a full contribution to a Roth.
Single
- If your AGI is more than $116,000, you cannot contribute to a Roth. Your contribution should be made to a Traditional IRA, depending on tax deductibility.
- If your AGI is between $101,000 and $116,000, the amount you may contribute to a Roth phases out the closer your income gets to $116,000. You should consult with your tax adviser for the amount you may contribute to a Roth. The remainder could be contributed to a Traditional IRA, depending on deductibility.
- If your AGI is below $101,000, you may make a full contribution to a Roth.
2008 IRA Contribution LimitsThe Economic Growth and Tax Relief Reconciliation Act of 2001 increased IRA contribution limits. Listed below are limits for both Roth and Traditional IRAs. This tax bill also created catch-up contributions for individuals who are age 50 and older.
Taxable Year |
Limit For Under 50 |
Limit For Over 50 (includes catch-up amount) |
Catch-Up Amount |
2008 |
$5,000 |
$6,000 |
$1,000 |
2009 |
$5,000 |
$6,000 |
$1,000 |
2010 |
$5,000 |
$6,000 |
$1,000 |
Before making any retirement plan contributions, you should always consult with your tax consultant. For more information regarding this topic, please contact The Henssler Financial Group at 770-429-9166 or comments@henssler.com.
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