Roth IRA Contribution Limits for 2025: What You Need to Know
Staying Ahead of the Game: IRS Announces New Roth IRA Contribution Limits
The Internal Revenue Service (IRS) has officially released the Roth Individual Retirement Account (IRA) contribution and income limits for 2025. As of next year, the total contribution limit to Roth IRAs remains steady at $7,000, with an additional $1,000 catch-up contribution for individuals 50 and older.
Income Thresholds Get a Boost
However, income thresholds for taxpayers making Roth contributions have seen an increase. To contribute up to the limit in a Roth IRA, your modified adjusted gross income must fall below a certain threshold, which has changed for 2025. The income phase-out range for single or head of household taxpayers now lies between $150,000 and $165,000, up from $146,000 to $161,000. For married couples filing jointly, the range has increased to between $236,000 and $246,000, up from $230,000 to $240,000.
Married Filing Separately: A Different Story
Notably, the phase-out range for married filing separately remains between $0 and $10,000, as it is not subject to an annual cost-of-living adjustment.
Higher Earners: Don’t Worry, There’s a Workaround
Higher earners may still be able to bypass the income limits using mega backdoor Roth conversions, which involve shifting after-tax 401(k) contributions to a Roth account. However, not all 401(k) plans allow this strategy.
A Broader Look at Inflation Adjustments
This update comes on the heels of the IRS’ recent announcement of dozens of inflation adjustments for 2025, including changes to federal income tax brackets, capital gains brackets, estate and gift tax exemptions, and more.
Stay Informed, Stay Ahead
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