2012 Roth IRA Rules
For the 2012 tax year there are some changes that have been made regarding Roth IRA rules. Below is a summary of those changes.
2012 Income Rules
The 2012 Roth IRA Income Limits have increased $3,000 for single tax filers and $4,000 for married filing joint filers over the 2011 levels.
In 2012 single filers can fully contribute to a Roth IRA if their modified adjusted gross income (MAGI) falls below $110,000.
For those filing "married filing joint" tax returns full contributions can be made to a Roth IRA if the modified adjusted gross income falls below a combined $173,000.
The contribution limit is phased out after $125,000 for single filers and $183,000 for married filing joint filers. If your income is above these limits you will not be allowed to contribute to a Roth IRA in 2012.
2012 Contribution Limits
The 2012 Roth IRA Contribution Limits remain unchanged from the 2011 limits.
All qualifying individuals may contribute $5,000 to a Roth IRA in 2011. Individuals age 50 or older may also contribute a "catch-up" contribution of $1,000.
2012 Age Rules
There are no changes to the age rules with Roth IRAs for 2012. Anyone with earned income that falls under the income rules may contribute to a Roth IRA regardless of age.
One of the benefits of using a Roth IRA over a Traditional IRA is you will never be forced to take distributions from the account regardless of age. You may begin withdrawing your earnings at age 59 and 1/2 without tax or penalty. Contributions may be withdrawn at any age without tax or penalty.
Important Roth Information
Each year, the IRS updates the rules for IRAs. Here are all the details for 2016: