Single taxpayers with a modified adjusted gross income above $99,000 can't continue to contribute from what I have read. What happens to the investments put into the Roth IRA after that point? Do they sit there and continue to grow until withdrawn at age 59 & 1/2?
Can another IRA type be started in parallel with the Roth IRA that no longer accepts contributions?
Does that $99K cap come from all sources of income, including dividend payouts, or only from wages?
The investments already there grow as usual, no impact. You can still start a non-deductable regular IRA, and convert in a future year when your income is below the conversion threshold. The cap is based on MAGI (modified adjusted gross income). See
Note that the $100,000 limit is for conversions and not contributions. You can continue to contribute to a Roth IRA up to $160,000 if married, filing jointly ($110,000 if single), although the maximum amount declines if you are over $150,000 ($95,000 if single).
You can also contribute to a deductible traditional IRA instead of a Roth subject to income, marital status, and employer-sponsored retirement plan limitations. See IRS Pub. 590.
-Will
OP asked about contributing. In 2006 for single, $95K - Full contribution, $110K - No contribution In 2007 for single, $99K - Full contribution, $114K - No contribution
The range is scaled, so in 06, for example, at $102.5K, one can contribute half what they otherwise could. $4K for under 50, $5K if 50 or over during the year for the deposit. JOE
Amazing how I can completely misread both the OP's post and your reply. Sorry about that.
-Will
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