How much can you contribute to a Traditional IRA for 2022?
It depends on your age, whether you have already contributed to a Roth IRA, and whether you or your spouse have earned income or not.
It's also important to note that just because you can contribute to a Traditional IRA that does no necessarily mean you are eligible for a tax deduction.
How much can you contribute to a traditional IRA for tax year 2022? The answer depends on a couple of different things. First off, in order to make a contribution at all, either you or your spouse must have earned income. If neither of you are working, you can't make a contribution to a traditional IRA. But let's assume that either one of you are working, then you can make a contribution up to $6,000 a piece.
Each of you could make this contribution if you're under 50. If you're 50 or over, you could each make a contribution of $7,000. That said though, it's very important to know that you can't make a contribution for more than what your earned income is. In other words, let's say that you make $100,000 this year in tax year 2022. Let's say you're over 50, you can contribute the full $7,000 and so could your spouse, so for a total of $14,000 in that case.
But let's say maybe you're basically retired, but you're working part-time and you're only making, let's say, $5,000 for the year. Well, the maximum that you could contribute to either your IRA or a spousal IRA for your spouse is $5,000. You can't make a contribution for more than what your earned income is. A couple of other real key things to note. One of them is that just because you can contribute to a traditional IRA, that does not necessarily mean that you'll get a tax deduction.
I'll cover that in another video. The other thing is that if you're also eligible to contribute to a Roth IRA and you're planning to make a contribution there, you need to know that the maximum contribution that you can make to both of them combined is either $6,000 or $7,000 depending on your age. As an example, let's say you're 50 or over, you can make the decision to contribute all $7,000, if you're eligible to do it, to a traditional IRA, or you contribute all $7,000 to a Roth IRA or you can mix it up.
Maybe you contribute $5,000 to a traditional IRA and you contribute $2,000 to a Roth IRA. Again, the maximum can't be more than that combined total limit. Hope that makes sense.