IRA rothIRA question

Here is my situation.....

I am 30 yrs old married and file my returns jointly. I had 401K through my employer in 2007 but my wife did not. So my understanding was that I can put $8K (Tax deductible traditional IRA + rothIRA) for my wife. Also I can put $4K (rothIRA) for me. In total $12K for year

2007.

However Vangaurd says as a couple we can only put $8K. I am not doubting Vangaurd but confounded because other websites I go to they calculate that I can put in upto $12K.

Our combined salary is below 150K and no dependents.

Thanks for any responses.....

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Reply to
learnfpga
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First, I trust your wife is under 50 as well. You may deposit only 2 x $4000 to IRAs. Since you are above the limit to deduct a regular IRA, you should choose the Roth. But again, the maximum is $4000 per person (for 07. In 2008 it's $5000, with an extra $1000 for those 50 or older.)

Joe

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Reply to
joetaxpayer

wrote

What other web sites?

Google for {IRA limits} and many sites turn up indicating that the total of your wife's contributions to a Roth and Traditional IRA cannot exceed $4k. The same limit applies to you. Hence a total of $8k is permitted for both you and your wife to all your IRAs. E.g.

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Reply to
Elle

No. You may put a max of $4k in the *combination* of your Roth and Traditional IRAs.

Nope. Total for two people - all all Roth + Traditional IRA contributions - is $8k.

The other websites are wrong (which are they?). Vanguard's right.

See page 60 of the IRS's Publication 590 which explains the Roth IRA limits:

...your contribution limit for Roth IRAs generally is the same as your limite would be if contributions were made only to Roth IRAs, but then reduced by all contributions for the year to all IRAs other than Roth IRAs. Employer contributions under a SEP or SIMPLE IRA plan do not affect this limit.

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Reply to
BreadWithSpam

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