Over Roth IRA Income Limits? 4 Ways You Can Still Contribute

With the recent changes to the IRS tax code, many individuals may find themselves wondering if they can still contribute to their Roth IRA. The annual contribution limit for 2023 is $6,000, which is significantly lower than the previous $7,000 limit. However, there are several strategies that can help individuals still contribute to their Roth IRA even with the lower limit.

4 Ways to Contribute to Your Roth IRA Despite the Lower Limit

1. Increase Your Income:
– If you have additional income sources, such as a side hustle or investment income, consider adding it to your taxable income.
– Contributing to your Roth IRA can help reduce your taxable income, increasing the amount of tax-free money you can save.
2. Adjust Your Contributions:
– The IRS allows you to adjust your annual contribution up to 100% of your eligible income.
– If your income is high, you may be able to increase your contributions to maximize your tax savings.
3. Consider Employer-Sponsored Plans:
– Many employers offer Roth IRA matching contributions.
– This means that a portion of your employer’s payroll is automatically transferred to your Roth IRA.
– Taking advantage of employer matching can significantly boost your contributions.
4. Explore Tax-Advantaged Investments:
– Contributing to your Roth IRA allows you to deduct the contributions from your taxable income.
– This reduces your taxable income and increases the amount of tax-free money you save.

Conclusion

While the annual contribution limit has been reduced, it is still possible to save for retirement through a Roth IRA. By exploring the various strategies outlined in this blog post, individuals can find ways to contribute to their retirement savings despite the lower limit. Remember to consult with a financial professional to determine the best approach for you and to ensure compliance with all tax laws.