Traditional IRA and Roth IRA Contributions - FAQs
Once you have your account set up you can make your Annual Contribution via check, wire, or ACH along with our Deposit Coupon Form.
You can also fund your account via rollover or transfer from a previous IRA custodian.
The annual contribution limit for both a Self-Directed Traditional IRA and Self-Directed Roth IRA combined is $5,500 for 2017 and 2018, or $6,500 if you’re age 50 or older. The amount you can contribute to your Roth IRA may be limited based on your filing status and income. See Individual Retirement Account Contribution Limits for more details.
If neither you nor your spouse is covered by a retirement plan at work, your deduction is allowed in full.
For contributions to a Traditional IRA, the amount you can deduct may be limited if you or your spouse is covered by a retirement plan at work and your income exceeds certain levels.
You may want to consult with a tax professional to determine if your Traditional IRA contribution is tax-deductible. Roth IRA contributions aren’t deductible.
Yes, you can contribute to a Traditional and/or Roth IRA even if you participate in an employer-sponsored retirement plan (including a SEP IRA or SIMPLE IRA plan).
Participation in an employer plan only affects the deductibility of your Traditional IRA contribution.
If you file a joint return and have taxable compensation, you and your spouse can both contribute to your own separate IRAs.
The maximum contribution you may contribute for each of your IRAs will be based on the annual limit or the amount of your earned income for the year, whichever is smaller. If you file a joint return you may both use your combined income to determine the amount you can contribute.
The contributions you make to each employee’s
- 25% of compensation, or
- $54,000 for 2017 ($55,000 for 2018)
These limits apply to contributions you make for your employees to all defined contribution plans, which includes SEPs. Compensation up to $270,000 in 2017 ($275,000 in 2018) of an employee’s compensation may be considered.
No, SEPs are funded by employer contributions only. Catch-up contributions apply only to employee elective deferrals.
Each eligible employee may make a salary reduction contribution and the employer must make either a:
- matching contribution
No other contributions may be made under a SIMPLE IRA plan.
You're generally required to either:
- match each employee's salary reduction contribution on a dollar-for-dollar basis up to 3% of the employee's compensation, or
- make nonelective contributions of 2% of the employee's compensation up to the annual limit of $270,000 for 2017 ($275,000 for 2018). If you choose to make nonelective contributions, you must make them for all eligible employees whether or not they make salary reduction contributions.
Yes, you must. Employees may not be excluded from participating in a SIMPLE IRA plan based solely on their age.
You must make matching and nonelective contributions to the financial institution maintaining the SIMPLE IRA no later than the due date for filing your business's income tax return, including extensions.
The maximum contribution limit has two components, the employee’s elective deferral as well as the employer’s profit sharing contribution.
The maximum employee elective deferral limit is $18,000(2017) and $18,500(2018). The maximum employer profit sharing contribution is up to 25% of compensation not to exceed $54,000(2017) and $55,000(2018).
Both elective deferral and profit sharing contribution combined is not to exceed the $54,000(2017) and $55,000(2018) limit. Only after the elective deferral limit has been met can an additional catch-up contribution of $6,000 be made.
Single Coverage 2017/2018 = $3,400/$3,450
Family Coverage 2017/2018 = $6,750/$6,850
Anyone covered under an eligible high deductible health plan (HDHP) may contribute to an HSA.
You cannot be enrolled in Medicare or any other health coverage that is not permitted by the IRS. See publication 969.
You can keep your HSA account at any age, but you can no longer make new contributions to the account after you have signed up for Medicare Part A or Medicare Part B.
For most individuals, this means you will no longer be eligible when you turn 65. You lose eligibility as of the first day of the month you turn 65.