Do you earn too much to make a Roth IRA contribution?
Under IRS rules, you’re prohibited from making a Roth IRA contribution if your modified adjustable gross income is more than:
- $183,000 if you’re married filing jointly, or
- $125,000 if you’re filing as a single person or head of household
If you fall into this category, you can’t make a Roth IRA contribution, right? Wrong.
While you can’t make a direct contribution to your Roth IRA, that doesn’t mean you should write off the idea of funding your Roth IRA this year.
You can still make an indirect contribution to your Roth IRA regardless of how much money you earn, and whether it’s a direct or indirect contribution, what’s most important is getting that money into your Roth IRA where it can grow tax-free and where you can withdraw it tax-free in your retirement years.