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Roth IRAs

The Roth IRA differs from Traditional IRAs in that funds contributed are not tax deductible.

These contributions consist of after-tax dollars. When funds are withdrawn from a Roth IRA, interest earned is tax-exempt as long as the Roth IRA holder meets certain criteria at the time of withdrawal.

Investors would benefit from a Roth IRA if they:
  • Expect to be in the same or an even higher tax bracket at retirement age,
  • Already contribute to a 401k or other company plan, or
  • Want to continue to contribute to an IRA Plan after age 70½.
  • Eligibility to contribute to a Roth IRA is based on your Modified Adjusted Gross Income (MAGI). You may be actively contributing to a 401(k) Plan and also be eligible to contribute to a Roth IRA.
  • Contributions can be made up until your tax-filing deadline, generally April 15, for a prior year contribution.
  • Eligible individuals may contribute the lesser of the annual contribution limit or 100% of their earned income to a Roth IRA.
  • Individuals over age 70 ½ may continue to make contributions to a Roth IRA as long as they have earned income.
  • You may contribute to both a Traditional and a Roth IRA for a combined total up to the annual contribution limit.
YearAnnual Contribution Limit
2020$6,000
2019$6,000
Catch-up Amount (Ages 50+)$1,000

IRA Eligibility MAGI Thresholds – Contribution Table

If you are: 2020 Modified Adjusted
Gross Income (MAGI) is		2019 Modified Adjusted
Gross Income (MAGI) is		Then
Single Individual- Less than $124,000
- $124,000 to $139,000
- Greater than $139,000		- Less than $122,000
- $122,000 to $137,000
- Greater than $137,000		- Contribution amount can be up to annual limit
- Contribution amount decreases as income increases
- Customer is not eligible to contribute
Married Individual Filing Jointly- Less than $196,000
- $196,000 to $206,000
- Greater than $206,000		- Less than $193,000
- $193,000 to $203,000
- Greater than $203,000		- Contribution amount can be up to annual limit
- Contribution amount decreases as income increases
- Customer is not eligible to contribute
Married Filing SeparateN/A
< $10,000
>=$10,000

N/A
< $10,000
>= $10,000		- Contribution amount can be up to annual limit
- Contribution amount decreases as income increases
- Customer is not eligible to contribute

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