How much can I contribute to my IRA and 401(k) next year? And will the income limit for Roth contributions rise?
The IRS just announced the new contribution limits for 2013, which increase slightly from 2012. The maximum you can contribute to a 401(k), 403(b), most 457s or the federal government’s Thrift Savings Plan rises from $17,000 to $17,500 in 2013. The catch-up contribution limit for people age 50 or older remains at $5,500.
For more information about boosting your 401(k) contributions, see How to Increase 401(k) Contributions.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
You can also kick in more to your IRA in 2013. For both traditional IRAs and Roths, the maximum you can contribute rises from $5,000 to $5,500 (the catch-up contribution is still $1,000 for people age 50 or older, bringing their total to $6,500 in 2013). The income limit for contributing to a Roth also rises slightly -- from $183,000 to $188,000 for married couples filing jointly, and from $125,000 to $127,000 for singles and people filing as head of household. The amount you can contribute starts to phase out if your adjusted gross income is $178,000 or more for joint filers, and $112,000 for singles and heads of household.
There's no income limit for contributing to a traditional IRA, but there are income limits for deducting contributions. Those limits have also increased slightly. For details, see 2013 Pension Plan Limitations.
[EMBED TYPE=POLL ID=23341]
The income cut-off for the saver’s credit (officially called the Retirement Savings Contribution Credit) will also rise a bit. This credit is designed to encourage lower-income workers to save for retirement in a retirement savings plan, such as an IRA or a 401(k). To qualify for the credit, your adjusted gross income must be below $59,000 if married filing jointly (up from $57,500 in 2012), $44,250 for heads of household (up from $43,125) or $29,500 for singles or married couples filing separately (up from $28,750). The lower your income, the bigger the credit, up to $1,000. For more information about the saver’s credit, see A Tax Credit for Retirement Savers.
For more information about saving for retirement, see our Jump-Start Your Retirement Plan special report.
-
What Wall Street's CEOs Are Saying About Trump's TariffsWe're in the thick of earnings season and corporate America has plenty to say about the Trump administration's trade policy.
-
The Role of the U.S. Dollar in Retirement: Is It Secure?Protect your retirement from de-dollarization, because “capital always goes where it is treated best."
-
Ask the Editor: Reader Questions, April 25 — 529 plansIn our latest Ask the Editor round-up, Joy Taylor, The Kiplinger Tax Letter Editor, answers questions related to 529 plans.
-
U.S. Treasury to Eliminate Paper Checks: What It Means for Tax Refunds, Social SecurityTreasury President Trump signed an executive order forcing the federal government to phase out paper check disbursements by the fall.
-
Key 2025 IRS Updates: What You Need to KnowFrom IRA contributions to Social Security COLAs and the standard deduction, several changes are headed our way. Get ready to make the most of them.
-
IRS Ends Inherited IRA Confusion: Annual RMDs Required for ManyIRAs The agency has resolved a major point of uncertainty for inherited IRA beneficiaries.
-
Three Reasons It May Look Like You Love the IRS More Than Your FamilyConsider these strategies to avoid overpaying taxes on your hard-earned money. Your family will thank you for it. (And you’ll thank yourself.)
-
Retirees Face Significant Tax Bills Due to FraudFraud A new report sheds light on how older adult scam victims end up with big tax bills and lost retirement savings.
-
Six Tax Breaks That Get Better With AgeTax Breaks Depending on your age, several tax credits, deductions, and amounts change — sometimes for the better.
-
Roth IRA Contribution Limits for 2025Roth IRAs Roth IRA contribution limits have gone up. Here's what you need to know.
