2022 UPDATE:

Traditional IRA Deductibility AGI Phaseouts:

Taxpayer covered by an employer plan:
S/HOH: $68,000 – $78,000. MFJ/QSS: $109,000 – $129,000
Taxpayer not covered by employer plan, but spouse is:
MFJ: $209,000 – $224,000

Roth IRA Contribution AGI Phaseouts
:
S/HOH: $129,000 – $144,000. MFJ/QSS: $204,000 – $214,000

This video defines what an IRA (Individual Retirement Arrangement) is and goes over the rules for contributing to them.

To learn more about the different between traditional and Roth retirement accounts, click here:

If you’re wondering how Adjusted Gross Income is calculated, click here:

Additional resources:

IRS Publication 17: “Your Federal Income Tax”:

IRS Publication 590-A: “Contributions to Individual Retirement Arrangements (IRAs)”:

IRS Schedule 1: “Additional Income and Adjustments to Income”:

IRS Form 8606: “Nondeductible IRAs”:

The Tax Geek on Twitter: @taxgeekusa

The Tax Geek on Reddit: www.reddit.com/r/askataxgeek

Intro and background music: “Bluesy Vibes” – Doug Maxwell – YouTube Audio Library

DISCLAIMER:

The information presented in this video is for informational and educational purposes only, and is not intended to render tax advice for specific situations. If you have questions about your specific tax situation, please consult the resources linked above or consult with a qualified tax professional in your community.

The information contained in this video is based on tax law and IRS regulations as of the date of publication, and may be subject to change….(read more)

LEARN MORE ABOUT: IRA Accounts

INVESTING IN A GOLD IRA: Gold IRA Account

INVESTING IN A SILVER IRA: Silver IRA Account

REVEALED: Best Gold Backed IRA

IRA 101: Contributions

An Individual retirement account, or IRA, is a retirement savings plan that offers tax advantages to help you save for retirement. Contributions to an IRA are made with after-tax dollars, meaning you don’t get a tax break for contributing to an IRA. However, the money you contribute grows tax-deferred, meaning you don’t have to pay taxes on the money until you withdraw it.

There are two main types of IRAs: traditional and Roth. With a traditional IRA, your contributions are tax-deductible in the year you make them, meaning you can reduce your taxable income for that year. With a Roth IRA, your contributions are not tax-deductible, but your withdrawals in retirement are tax-free.

The amount you can contribute to an IRA each year depends on your age and income. Generally, you can contribute up to $6,000 per year ($7,000 if you’re 50 or older) if you meet certain income requirements. You can also make catch-up contributions of up to $1,000 if you’re 50 or older.

In addition to the annual contribution limits, there are also income limits that determine how much of your contribution you can deduct. If your modified adjusted gross income (MAGI) is below the limit, you can deduct the full amount of your contribution. If your MAGI is above the limit, you may only be able to deduct a portion of your contribution or none at all.

When it comes to making contributions to an IRA, it’s important to understand the rules and limits. By taking advantage of the tax advantages of an IRA, you can help ensure a more secure retirement.