Individuals can save up to $5,500 through an individual retirement account (IRA) for 2013, according to new limits announced by the IRS (IR-2012-77). This new $5,500 limit is the first change in IRA contribution limits since 2008. For the years 2008 through 2012, IRA contributions were capped at $5,000.
The $5,500 IRA contribution limit for 2013 applies to traditional IRAs and Roth IRAs collectively. Taxpayers can choose to contribute either to a traditional IRA or to a Roth IRA or to both in any combination, as long as total contributions don't exceed the annual limit.
The IRS also updated the income limits for being eligible to deduct contributions to a traditional IRA and for being eligible to contribute to a Roth IRA.
Is there an over 55 yr catch up of $1000 still on the IRA $5500 new limit?
Jack, an excellent question. I dug into this a little further and found out that the provision for catch-up contributions expires this year (tax year 2012). Congress will need to pass new legislation in order for catch-up contributions for 2013.
it’s not in public favor..
Catch up contribution is still available in 2013
http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-IRA-Contribution-Limits
This is good to know! Thank you, Bill, for pointing us to that IRS web page with the catch-up contributions.
Is it possible to open a Roth IRA in Dec. 2012 with the maximum ($5,000) and then add another $5,500 in January 2013?
Scott, yes! Just make sure that you designate the $5500 that you contribute in January as a contribution for 2013, not 2012. The IRS allows contributions for the tax year up through tax day of the following year. Hope that helps.
Jan. 11, 2013 – Did the law allowing “catch-up contributions”, for those over 55 years of age, get extended, or did it in fact expire at the end of 2012? There seems to be conflict among internet financial sources as to this. Thanks.
I have a 401 k match at work – can I put 5k in a Traditional IRA for 2012?
Thanks
Jerry, yes you can… your limits in an IRA have nothing to do with a qualified plan contribution.
HI, I am self emplyed and have a solo 401k. Can I still open an IRA account?
Thanks
Pang
Are “Catch-Up” contributions of $1,000 also limited to the total amount of taxable compensation for 2013? For example, I work part time and earn $4,000 in 2013; I put $4,000 in my Roth IRA account for the 2013 tax year. May I put an additional $1,000 in my Roth IRA for the 2013 year?
William, the amount that can be contributed to an IRA — of any type, whether traditional or Roth — is limited by your earned income, which for IRA purposes consists of wages, net self-employment income, and alimony. This topic is discussed in more detail in the compensation section of Publication 590.
As a single person with an income of 100K + that is contributing to a company sponsored 401k, I am unable to deduct any of my IRA contributions. Given this is the case, does it still make sense to contribute?