Contributions to Traditional IRAs and Roth IRAs Are Aggregated
Contributions to IRAs and Roth IRAs are aggregated. For 2023, the total contributions you make to all of your Roth IRAs and Traditional IRAs cannot exceed the following amounts:
- $6,500 ($7,500 if you’re age 50 or older), or
- if less, your taxable compensation for the year
This means that for 2023 you cannot contribute the above limit to each type (i.e., traditional and Roth IRA); however, you can contribute some to each up to the above combined limit.
2023 Traditional IRA Contributions May NOT be Fully Tax Deductible
While the IRS rules allow for contributions to both Solo 401k plans and IRAs, if you are also participating in a solo 401k plan, you can still make the traditional IRA contributions but they may not be tax deductible. See the chart listed on the following IRS link for these limits: https://www.irs.gov/retirement-plans/2023-ira-deduction-limits-effect-of-modified-agi-on-deduction-if-you-are-covered-by-a-retirement-plan-at-work
2023 Traditional IRA Contributions Limits if You Also Contribute to Your Solo 401k
If you contribute to your full-time employer 401k or your solo 401k plan, you may not be able to fully deduct your Traditional IRA contributions. Use this table to determine if your modified AGI affects the amount of your Traditional IRA deduction.
| If Your Filing Status Is… | And Your Modified AGI Is… | Then You Can Take… |
|---|---|---|
| single or head of household | $73,000 or less | a full deduction up to the amount of your contribution limit. |
| single or head of household | more than $73,000 but less than $83,000 | a partial deduction. |
| single or head of household | $83,000 or more | no deduction. |
| married filing jointly or qualifying widow(er) | $116,000 or less | a full deduction up to the amount of your contribution limit. |
| married filing jointly or qualifying widow(er) | more than $116,000 but less than $136,000 | a partial deduction. |
| married filing jointly or qualifying widow(er) | $136,000 or more | no deduction. |
| married filing separately | less than $10,000 | a partial deduction. |
| married filing separately | $10,000 or more | no deduction. |
For the above chart, if you file separately and did not live with your spouse at any time during the year, your IRA deduction is determined under the “single” filing status.
ROTH IRA CONTRIBUTIONS
Roth Solo 401k contributions are not impacted by your modified AGI. While you can also contribute to a Roth IRA and a solo 401k plan, not everybody qualifies for making a Roth IRA contribution if their modified AGI is over a certain limit. For these limits, please see the following chart: https://www.irs.gov/retirement-plans/amount-of-roth-ira-contributions-that-you-can-make-for-2023
Amount of Roth IRA Contributions That You Can Make for 2023
This table shows whether your contribution to a Roth IRA is impacted by the amount of your modified AGI as computed for Roth IRA purpose.
| If your filing status is… | And your modified AGI is… | Then you can contribute… |
|---|---|---|
| married filing jointly or qualifying widow(er) | < $218,000 | up to the limit |
| married filing jointly or qualifying widow(er) | > $218,000 but < $228,000 | a reduced amount |
| married filing jointly or qualifying widow(er) | > $228,000 | zero |
| married filing separately and you lived with your spouse at any time during the year | < $10,000 | a reduced amount |
| married filing separately and you lived with your spouse at any time during the year | > $10,000 | zero |
| single, head of household, or married filing separately and you did not live with your spouse at any time during the year | < $138,000 | up to the limit |
| single, head of household, or married filing separately and you did not live with your spouse at any time during the year | > $138,000 but < $153,000 | a reduced amount |
| single, head of household, or married filing separately and you did not live with your spouse at any time during the year | > $153,000 | zero |
