0

I have read some pretty poor threads on this site after doing some searches. I would like the following questions answered with the relevant documentation. Suppose I made $125,000 in the United States in 2014 and contributed $17,500 to an employer's 401k plan. Assuming no other variables would I be able to contribute the phased out amount (less than $5,500) to a Roth IRA, or the full amount ($5500) based on the $125,000 - $17,500 = $107,500 amount? I know it is all related to Modified Adjusted Gross Income. Thanks in advanced and sorry for beating a dead horse.

  • By the way, the Roth IRA contribution income limit isn't really an obstacle these days. Assuming you have no money in Traditional IRAs, you can do a backdoor Roth IRA contribution (i.e. contribute to a Traditional IRA, then immediately convert it to a Roth IRA), which has no income limit regardless of filing status, and the result is the same as a regular Roth IRA contribution. – user102008 Apr 13 '15 at 23:32
2

Depends- If you are filing as single:

If you contributed to a traditional 401k - you can contribute the full $5,500 to a Roth IRA

If you contributed to a Roth 401k - you would have a phased amount to contribute to your Roth IRA

Some employers offer both traditional and roth 401k so your answer depends on which one you elected to contribute to.

Reason: It's like you said - it's about the Modified Adjusted Gross Income (MAGI)

If you contributed to a traditional 401k - your MAGI is $107.5k (Under the $114k single filer limit)

If you contributed to a roth 401k then your MAGI is still $125k

Married filing jointly - You can contribute the full amount to a roth IRA as the limit is $181k

Married filing separately You can't contribute at all to a roth IRA

If you want to learn more about roth vs traditional

Or if you already contributed too much to a roth IRA:

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.