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Author: TMFExRO Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121178  
Subject: Re: Roth salary limits Date: 1/9/2001 10:17 AM
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I will make over 100,000 USD in 2001. I don't know the exact number yet, as it depends on commissions which haven't been finalized. It will likely be around 110,000 USD.

I have been contributing to a Roth IRA in the past, but it looks like I won't be able to contribute 2000 USD this year due to my salary.


For a single filer, Roth eligibility ends at a modified AGI of $110,000.

Should I just open a traditional IRA and invest all my 2000 USD there, or should I split my contribution into both my Roth and a new IRA? Can you recommend some easy to read literature on how I calculate how much I can contribute to the Roth?

There is a worksheet in IRS Publication 590 that you can use to calculate your maximum Roth contribution. If you're eligible for any Roth contribution, I would recommend that you make it, contributing the balance of your $2,000 to a traditional.

Also to make things even more difficult, I am living abroad and I just got married to a non-US citizen. How will this effect my IRA contribution? Can I now invest 4000 USD if we file joint taxes?

Congratulations on your marriage. To borrow from our soon-to-be-ex President, it depends on what the meaning of "just" is. If you choose to file a joint return, the MAGI limit for full Roth contributions is $150,000, with the complete phaseout at $160,000. As long as there is $4,000 in taxable compensation on your joint return, each of you can contribute $2,000 to an IRA ($2,000 for you and $2,000 for your spouse). If you were married in 2000, these rules apply to your 2000 contribution, which you can make through 4/16/2001, as well as your 2001 contribution.

You'll find all this discussed in Publication 590.

TMF ExRO
Phil Marti
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