"Fiscal Cliff" Roth IRA Update

Matthew Malone

New law has no impact on 2012/2013 Roth IRAs income/contribution limits; in-plan conversions impacted

The legislative wrangling over the so-called fiscal cliff has everyone concerned–and confused–about its impact on their financial health. Here's the good news, at least for retirement savings: the recent law has no impact on 2012 and 2013 IRA income and contribution limits. Changes to "in-plan" conversion rules are discussed here.

Remember that you have until the tax filing deadline (April 15, 2013) to make a contribution for 2012.

For reference, here's our 2012 Roth and Traditional IRAs comparison

The 2013 Roth income guidelines are as follows:

If your filing status is...	And your modified AGI is...	Then you can contribute...
married filing jointly or qualifying widow(er)	< $178,000	up to $5,500
	> $178,000 but < $188,000	a reduced amount
	> $188,000	zero
married filing separately and you lived with your spouse at any time during the year	< $10,000	a reduced amount
	> $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	< $112,000	up to $5,500
	> $112,000 but < $127,000	a reduced amount
	> $127,000	zero

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Important 2012 Information

Each year, the IRS updates the rules for Roth IRA. Here are all the details for 2012: