While Roth IRA accounts are a great way to invest, particularly for investors with a decade or more until retirement, there are limits that restrict how much you can invest in a Roth. Income limits may further restrict your contribution limits and eligibility.
Here are the contribution limits for most Roth IRA savers and investors:
- 2018: $5,500
- 2019: $6,000
- 2020: $6,000
If you are 50 or older, you can add an extra $1,000 per year for a total of $7,000 for 2019 and 2020. You can’t contribute more than you earn in a year, although married couples filing jointly can share earnings to bring both spouses to the annual limit.
For 2020, if you earn more than $124,000 per year for single filers or $196,000 when married filing jointly, an income limit kicks in. Your contributions are restricted over those income limits and phase out completely at $139,000 when single or $206,000 when filing jointly.
You are able to make contributions for the prior year until you file your taxes or the tax due date in April, whichever comes first. That means you can make contributions for 2019 until April 15, 2020. This deadline also applies to traditional IRA contributions, which are made with pre-tax dollars.
*To learn more about Roth IRA accounts, read Investor Junkie