The limits of a Roth IRA contributions depend on three factors: income, age and marital status, according to RothIRA.com. The money contributed must be from earned income. The contribution limit in 2014 was $5,500 for those under 50.Know More
For a single individual under the age of 50 with an adjusted gross income of $114,000 or less, the contribution limit to a Roth IRA is $5,500, states the IRS. For the same individual with an income between $114,001 to $129,000, use IRS worksheet 2-2 from IRS publication 590 to determine the reduced contribution limit. The same individual with an income exceeding $129,000 would not be allowed to contribute to a Roth IRA.
For a married couple filing separately, a reduced amount can be contributed to a Roth IRA if the AGI is less than $10,000, reports RothIRA.com. If the AGI is more than $10,000, the married couple cannot contribute to a Roth IRA. If a married couple is filing separately, and have not lived together during the year, they can follow the same guidelines as single filers.
A married couple filing jointly, or a qualifying widow or widower, with an AGI income less than $183,000 can contribute up to the $5,500 limit, according to RothIRA.com. The same couple with an income greater than $183,000 but less than $193,000 can contribute a reduced amount. If the AGI income is greater that $193,000, the couple cannot contribute to a Roth IRA. For individuals age 50 or older, the same guidelines apply; however, they are allowed to contribute an extra $1,000 per year, to catch up on retirement investments.Learn more about Financial Planning
An investor can withdraw his Roth IRA contributions at any time without tax or penalty. To withdraw earnings or interest the Roth IRA earns without paying taxes, he must be at least 59 1/2 and the Roth IRA must be at least 5 years old.Full Answer >
For 2014 and 2015, Roth IRA contributions are only limited if taxable compensation is less than $5,500 ($6,500 for persons 50 years of age and older). In such cases, contributions are limited to the amount of taxable compensation. Otherwise, contributions are limited to $5,500 of $6,500, regardless of income.Full Answer >
Individuals are able to convert their 403(b) into a traditional Roth IRA when they leave their job that carries the 403(b), states Investopedia. However, if a person leaves his current job for an employer who does offer a 403(b), he cannot convert his retirement plan into a Roth IRA.Full Answer >
Withdrawal from a Roth IRA occurs at anytime. However, to avoid penalties for early withdrawals the participant must obtain the age of 59.5 years and own the account for at least five years, explains CNN Money.Full Answer >