Tips for Making Your 2017 IRA Contributions

by P.J. DiNuzzo                                                                                                March 16, 2018

Tips for Making Your 2017 IRA Contributions

You have until Tuesday April 17, 2018 to make your Traditional or Roth IRA contribution for 2017. Please bear the following in mind when making your 2017 IRA contribution.

 In order to meet your regular IRA contribution deadline, it must be postmarked or hand delivered to your financial institution by April 17, 2018.

Your regular IRA contribution is limited to the lesser of $5,500 ($6,500 if you were at least age 50 on December 31, 2017), or 100% of eligible compensation that you received during 2017. Eligible compensation includes any amount properly shown in box 1 (Wages, tips, other compensation) of Form W-2, commissions and self-employment income.  Regardless of the number of IRAs to which you make contributions, the total amount must not exceed this limit. 

You must meet the eligibility requirements for making your regular IRA contribution. For traditional IRA contributions, this means that you must be under age 70½ as of December 31, 2017.  For Roth IRAs, your modified adjusted gross income (MAGI) must be below the following amounts:

* $133,000 if your tax filing status is single,
* $196,000 if your tax filing status is married filing jointly, and
* $10,000 if your tax filing status is married filing separately.

You might be able to make a reduced contribution to your Roth IRA, if your MAGI is between:

* $118,000 and $133,000 if your tax filing status is single,
* $186,000 and $196,000 if your tax filing status is married filing jointly, and
* More than $- 0 - but less than $10,000 if your tax filing status is married filing separately.

If your MAGI falls within these ranges, we can provide you with information about how to determine the Roth IRA contribution amount for which you are eligible.

Be sure to indicate that your contribution is for 2017, otherwise, your financial institution will likely treat it as a contribution for 2018. This could cause you to miss the opportunity for making an IRA contribution for 2017. Your account number should also be clearly noted, to ensure that it is deposited to the right account.

If you have questions about these and other rules that apply to your IRA contribution, please be sure to contact us.

Sincerely, 

P.J. DiNuzzo, CPA, PFS, AEP®, AIF®, MBA, MSTx
President, Founder, and Chief Investment Officer