IRA Limit for 55 and younger 5,500
IRA limit for 55 and older 6,500
Three kinds of IRA to choose from, based on your eligibility.
1 ROTH IRA [No immediate tax benafit]
Contribution faces out after AGI 189,000 for married filing jointly and can’t contribute if AGI is more than 199,000.
Contribution faces out after AGI 120,000 for singles and heads of household and can’t contribute if AGI is more than 135,000.
2 Deductible IRA [Immediate tax benafit]
For married couples filing jointly, in which the spouse who makes the IRA contribution is covered by a workplace retirement plan, the income phase-out range is $101,000 to $121,000.
For taxpayers making contributions to a traditional IRA is phased out for singles and heads of household who are covered by a workplace retirement plan and have modified adjusted gross incomes (AGI) between $63,000 and $73,000.
For an IRA contributor who is not covered by a workplace retirement plan and is married to someone who is covered, the deduction is phased out if the couples AGI is between $189,000 and $199,000
For a married individual filing a separate return who is covered by a workplace retirement plan, the phase-out range is not subject to an annual cost-of-living adjustment and remains $0 to $10,000.
3 Non-deductible IRA. [ No immediate tax benafit]
[For those are not eligible for roth and deductible IRA due to higher income.
In this case, you can start with Non- deductible IRA and convert immediately to ROTH IRA it is also known as backdoor Roth, Now your earnings are tax-free.