The IRS has released its retirement plan limitations for 2014, and while the contribution limits remain the same as 2013, the income phase-out ranges have increased.
Here are the contribution limits for 2014:
401(k), 403(b) and 457 plans: maximum contribution of $17,500 for those under 50; for those over 50, add a catch-up contribution of $5,500 for a total of $23,000.
IRAs: maximum contribution of $5,500, plus another $1,000 for those over the age of 50.
The ability to take tax deductions for contributions to a traditional IRA depend on whether you are contributing to an employer plan and how much you earn. Deductions are phased out when your adjusted gross income (AGI) exceeds a certain limit. The new limits for 2014 are:
Deductions for IRAs made by single and head-of-household filers phase out for those who are covered by a workplace plan and have AGIs between $60,000 and $70,000, up from $59,000 to $69,000 in 2013. That means you get a full deduction if you earn up to $60,000, and a partial deduction if you earn up to $70,000.
If you’re married filing jointly and you contribute to a workplace plan, the income phase-out range is $96,000 to $116,000, up from $95,000 to $115,000 in 2013.
If you’re married filing jointly and your spouse contributes to a workplace plan but you do not, the income phase-out range for deductibility of contributions is $181,000 to $191,000, up from $178,000 to $188,000 in 2013.
If you’re married and filing separate returns, the phase-out range remains $0 to $10,000, the same level it’s been for many years, and doesn’t get a cost-of living adjustment.
The income limits for contributions to a Roth IRA are as follows:
Income phase-out ranges for married couples filing jointly who contribute to a Roth IRA are $181,000 to $191,000, up from $178,000 to $188,000 in 2013.
For married couples filing separately, the phase-out range remains $0 to $10,000, with no cost-of-living adjustment.
Single and head-of-household filers can earn up to $114,000 and contribute to a Roth IRA. The income phase-out range is $114,000 to $129,000, up from $112,000 to $127,000 in 2013.
The Flanigan Law Group provides Southern California residents with personal attention for estate planning, administration and litigation legal services. When disputes between families, arise, they are very successful in resolving legal estate issues quickly and efficiently while preserving financial and emotional resources. Contact the Flanigan Law Group at 949-450-0041.