How Much Can You Save in 2014?

Each year, the IRS determines how much you can contribute to various retirement accounts and how much you can deduct, depending on your age and income.


Contributions

Basic contribution rules are pretty simple.

If you are under 50 years of age at the end of the calendar year, you may be able to contribute up to $5,500 or 100% of your earned income, whichever is less, to a Traditional or Roth IRA in 2014. Your contributions can be split between a Traditional IRA and a Roth IRA, but the combined limit is $5,500. You can also contribute up to $17,500 to a 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan.

If you are 50 years of age or older at the end of the calendar year, you may be able to contribute up to $6,500 or 100% of your earned income, whichever is less. Again, you can split your contributions between a Traditional IRA and a Roth IRA, but the combined limit is $6,500. Like people under 50, you can contribute up to $17,500 to a 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan. However, you can also contribute an additional $5,500 in “catch-up contributions.”

However, for people of all ages, the amount of money you contribute to a Roth IRA may be reduced depending on your modified adjusted gross income (AGI).


If you have taxable
compensation and
your filing status is…
And your modified
AGI is…
Then…
married filing jointly or
qualifying widow(er)
less than $181,000you can contribute up
to the contribution
limit.
at least $181,000
but less than
$191,000
the amount you can
contribute is reduced.
$191,000 or moreyou cannot contribute
to a Roth IRA.
married filing separately and
you lived with your spouse
at any time during the year
$0you can contribute up
to the contribution
limit.
more than $0 but
less than $10,000
the amount you can
contribute is reduced.
$10,000 or moreyou cannot contribute
to a Roth IRA.
single, head of household, or
married filing separately and
you did not live with your
spouse at any time during
the year
less than $114,000you can contribute up
to the contribution
limit.
at least $114,000
but less than $129,000.
the amount you can
contribute is reduced.
more than $129,000you cannot contribute
to a Roth IRA.


Deductions

The deductible portion of your Traditional IRA contribution may also be reduced depending on your modified AGI.

If you are covered by a retirement plan at work, use this table to determine if your modified AGI affects the amount of your deduction.


If your filing status is…And your modified
AGI is…
Then you can take…
married filing jointly or
qualifying widow(er)
less than $96,000a full deduction up to
the amount of your
contribution limit.
at least $96,000
but less than
$116,000
a partial deduction.
$116,000 or moreno deduction.
single or head of householdless than $60,000a full deduction up to
the amount of your
contribution limit.
at least $60,000
but less than
$70,000
a partial deduction.
more than $70,000no deduction.
married filing separately*less than $10,000a partial deduction.
$10,000 or moreno deduction.

If you are not covered by a retirement plan at work, use this table to determine if your modified AGI affects the amount of your deduction.


If your filing status is…And your modified
AGI is…
Then you can take…
single, head of household, or
qualifying widow(er)
any amounta full deduction up to
the amount of your
contribution limit.
married filing jointly or
separately with a spouse
who is not covered by a plan
at work*
any amounta full deduction up to
the amount of your
contribution limit.
married filing jointly with a
spouse who is covered by a
plan at work
less than $181,000a full deduction up to
the amount of your
contribution limit.
at least $181,000
but less than
$191,000
a partial deduction.
more than
$191,000
no deduction.
married filing separately
with a spouse who is
covered by a plan at work*
less than $10,000a partial deduction.
$10,000 or moreno deduction.

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