Individual Retirement Account Contribution Limits
All individual retirement accounts offer tax-sheltered growth for retirement savings, in addition to other tax benefits that apply only to certain types of IRAs. The Internal Revenue Service limits how much money a taxpayer can deposit into IRAs each year.
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Annual Limits
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As of 2010, the annual limit for IRA contributions is $5,000 for people under 50 and $6,000 for those 50 and older. The contribution limit for Roth IRAs is decreased or eliminated for taxpayers whose modified adjusted gross incomes are above limits set by the IRS, based on income-tax filing status.
Minimum Income
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You cannot contribute more to your IRA than the amount of earned income you have for the year. Earned income only includes payments to you for work performed -- it does not include pensions or investment income.
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Considerations
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The IRA contribution limit applies to traditional IRAs and Roth IRAs cumulatively. For example, if your annual contribution limit equals $5,000 and you put $4,200 into a Roth IRA, you could not contribute more than $800 to a traditional IRA.
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