IRA Contribution Calculator 2025 – Traditional vs Roth Limits

Introduction

Use this guide to find your 2025 IRA contribution room, check Traditional IRA deduction phase‑outs, and compare Roth vs Traditional outcomes.

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Inputs

• Filing status and MAGI
• Covered by workplace plan? (affects deduction)
• Age 50+ catch‑up

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Output

• Max contribution amount
• Deductible vs non‑deductible portion (Traditional)
• Roth eligibility or phase‑out status

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Tips

• If ineligible for Roth, consider backdoor Roth
• Deduct Traditional if in higher bracket now; consider Roth if taxes will rise later
• Coordinate with 401(k)/HSA tax strategy

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Related Tools

• Roth IRA Income Limit 2025: /calculator
• Backdoor Roth 2025: /calculator
• Tax Bracket 2025: /calculator

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CTA: Max Your IRA

Enter your status and income to see your 2025 IRA options and tax impact.

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IRA Rules 2025: Overview (Verify Official Numbers)

This calculator assumes standard 2025 U.S. IRA rules. Always verify official IRS thresholds when you file, including: total contribution limit, age‑50 catch‑up, Traditional IRA deduction phase‑out ranges when you (or your spouse) are covered by a workplace plan, and Roth IRA MAGI phase‑outs by filing status.

Key concepts to know:

• Traditional IRA contribution limit vs deduction limit: you may be able to contribute even if your deduction is partially or fully phased out.
• Roth IRA contribution limit vs eligibility: your ability to contribute phases out with MAGI; excess contributions must be removed to avoid penalties.
• Backdoor Roth: non‑deductible Traditional IRA contribution followed by Roth conversion; pro‑rata rules apply across all your pre‑tax IRA assets.
• Spousal IRA: a non‑working spouse may contribute based on the working spouse’s earned income if filing jointly.

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Calculation Methodology and Assumptions

1. Determine whether you have sufficient earned income to cover the contribution (earned income is generally required).
2. Identify workplace plan coverage for you and/or spouse—this affects Traditional IRA deduction.
3. Compute MAGI for IRA purposes (start with AGI and apply IRS adjustments).
4. Apply deduction phase‑out (Traditional IRA) if covered and within the MAGI range for your filing status.
5. Apply Roth contribution phase‑out to determine maximum direct Roth amount.
6. If Roth is limited, consider non‑deductible Traditional IRA plus Roth conversion (backdoor), mindful of pro‑rata aggregation.
7. If age 50+, factor in catch‑up if allowed.
8. If filing jointly and one spouse has low/no earnings, consider a spousal IRA.

Assumptions and caveats:

• This guide does not display exact dollar thresholds; use the IRS tables for 2025 to confirm.
• State taxation of conversions/deductions varies—check state rules.
• Pro‑rata applies across all pre‑tax IRA balances on December 31 of the conversion year (including rollover IRAs).
• Employer plans like 401(k) don’t count toward pro‑rata; rolling pre‑tax IRA funds into a 401(k) may improve backdoor outcomes.

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Traditional vs Roth: Decision Framework

• Higher current bracket vs expected lower retirement bracket → Traditional (deduct now).
• Lower current bracket vs expected higher future bracket → Roth (pay tax now).
• Expecting large RMDs later or concerned about Medicare IRMAA thresholds → Roth contributions/conversions can help manage future taxable income.
• Uncertain? Diversify contributions (split between accounts when allowed) or use Roth till a bracket cliff, then Traditional.

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Examples (Illustrative Only)

Example 1: Single, Covered by Workplace Plan

• MAGI in the deduction phase‑out band.
• Traditional IRA contribution allowed but only partially deductible; Roth eligibility also phases out.
• Strategy: Fill employer plan first to match, then decide between partially deductible Traditional vs backdoor Roth depending on pro‑rata exposure.

Example 2: Married Filing Jointly, Only One Spouse Covered

• Working spouse covered by a plan; non‑working spouse not covered.
• Deduction rules differ for each spouse; often the non‑covered spouse has a higher deduction MAGI range.
• Strategy: Max 401(k) for covered spouse; for IRAs, consider deductible Traditional for non‑covered spouse and Roth/backdoor for the other.

Example 3: High‑Income Household

• MAGI above Roth limit; Traditional deduction phased out due to coverage.
• Strategy: Backdoor Roth flow using non‑deductible Traditional contributions; mitigate pro‑rata by rolling pre‑tax IRA assets into a 401(k) if the plan accepts roll‑ins.

Example 4: Age 50+ Catch‑Up

• Eligible for catch‑up contributions.
• Strategy: Coordinate catch‑ups across IRA and workplace plans; prioritize accounts with employer match first, then tax‑diversify.

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Pro‑Rata Rule for Backdoor Roth (Critical)

When you convert any portion of a Traditional IRA to Roth, the taxable portion is proportional across all your pre‑tax and after‑tax IRA dollars aggregated on December 31. This includes rollover IRAs and SEP/SIMPLE IRAs. If most of your IRA assets are pre‑tax, a backdoor conversion may be largely taxable. Options:

• Roll pre‑tax IRA funds into an active 401(k)/403(b) to reduce pre‑tax IRA balance before conversion.
• Time conversions in a low‑income year.
• Maintain meticulous Form 8606 records for basis tracking.

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Coordination With 401(k)/403(b)/457 and HSA

• If limited cash flow, prioritize employer match first.
• HSAs (if eligible) can beat both Traditional and Roth IRAs due to triple tax advantage.
• After the match and HSA, weigh Roth vs Traditional IRA based on bracket management and future RMD concerns.
• Consider Mega Backdoor Roth in plans that allow after‑tax contributions and in‑plan conversions (separate from IRA rules).

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Common Pitfalls

• Contributing directly to a Roth IRA while over the MAGI limit (excess contributions trigger penalties).
• Missing Form 8606 for non‑deductible Traditional contributions.
• Overlooking pro‑rata and triggering big tax bills on backdoor conversions.
• Forgetting spousal IRA eligibility when one spouse has little or no earned income.

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Frequently Asked Questions

Q: Can I contribute to both a Traditional and a Roth IRA in the same year?
A: Yes, but your combined IRA contributions cannot exceed the annual limit (plus catch‑up if eligible).

Q: Do IRA contributions require earned income?
A: Generally yes; investment income doesn’t count. Spousal IRAs allow contributions for a non‑earning spouse if filing jointly and the working spouse has enough earned income.

Q: Is a backdoor Roth legal?
A: Yes, but you must follow contribution and conversion rules and file Form 8606; pro‑rata applies.

Q: Should I convert in a bear market?
A: Market dips can reduce the immediate tax cost of converting the same number of shares; the decision still hinges on lifetime tax planning.

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Action Checklist (Copy/Paste)

• Confirm earned income covers contributions
• Check workplace plan coverage and deduction phase‑outs
• Verify Roth eligibility or use backdoor Roth if appropriate
• Review pro‑rata exposure; consider roll‑ins to 401(k)
• File Form 8606 when required
• Revisit annually as income and rules change