2022 Roth IRA Contribution Limit
Hi,
I have client (married couple) both in their 70s. Husband has been retired for years. Wife retired in January 2022. The wife earned income as follows in 2022 before retiring.
Total gross: $13,458.61
Fed taxable gross: $12,651. 09 (due to about $800 in before-tax 401(k) deductions
Their MAGI will be about $100,000 so they will be making 2022 Roth IRA contributions. I know that since the wife didn’t earn at least $14,000, they can’t each do $7,000. I know the wife can do $7,000 into her Roth IRA. How much can the husband contribute into his Roth IRA (even though he didn’t work)? I am not sure if their total 2022 Roth IRA contribution limit is the total earned income for the wife $13,458.61 (in which case husband can contribute $6,458.61 into his Roth) or her federal taxable gross income $12,651.09 (in which case husband can contribute $5,651.09 into his Roth). Can you please clarify?
Permalink Submitted by William Tuttle on Sun, 2022-08-21 22:27
Their combined maximum IRA contributions are $12,651. 09 between them in any combination. See IRS Publication 590-A, What Is Compensation?
Permalink Submitted by David Mertz on Sun, 2022-08-21 22:30
The compensation available to contribute to IRAs is reduced by the amount of the elective deferrals to the workplace retirement plan. Each can contribute up to $7,000, but the combined total is not permitted to exceed $12,651.09, the amount that will appear in box 1 of Wife’s W-2.