For all those who seek a tax-free retirement its best to head towards the Roth IRA which is an excellent retirement investment option. Details regarding the same can be read at roth-ira.org.
Depending on the income of an individual Roth IRA has a list of specifications regarding income eligibility. Roth IRA can be availed only if one’s income adheres to a specific level that is set by the IRS. Marital status of an individual determines the level of specificity. The income of an individual that is considered is usually based on the work performed and not the income that is acquired through other investments or rental income.
The basic guidelines that are followed are that if one is single or if he or she is the head of the household then the income should be less than $107,000 in order to contribute fully to a Roth IRA. In case one is married and filling jointly or if one is a qualified widow or widower then income should be less than $169,000 to contribute fully to a Roth IRA. In the case of a married individual filling separately then the income ought to be less than $ 10,000 to contribute fully to a Roth IRA.
Roth IRA has certain rules regarding contribution eligibility as well. People who have an income that adheres to the above mentioned guidelines can use Roth IRA to save for retirement. Age plays a important role and determines how much you can save. $5000 can be contributed towards a Roth IRA if one is under the age of 50. If married, each individual can keep aside $5000 towards their retirement. The contribution limit is not the total limit per account but total limit across any number of Roth accounts. If one is 50 or older then the same $5000 remains applicable. One is also allowed to contribute an additional $1000 as a catch up contribution towards retirement.