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How to determine your Roth IRA eligibility

By Business & Finance Last updated Sunday, May/05/2024

1). The eligibility of Roth IRA is depended on income. It is a retirement account for people with regular incomes not for the rich. It has two categories, those that are eligible for full contribution and those that are eligible for partial contributions.
2). The income used to determine eligibility is called MAGI, or modified adjusted gross income. Use form 8606 to determine your MAGI. The qualifying amount is different depending on martial status and filing method.
3). If you are single, file by yourself and your MAGI is less than $100,000, you will qualify for full contribution. And partial contribution is your income is $100,000 to $116,000. For married couples that are filing jointly, MAGI should be less than $159,000 to qualify for full contribution. And $159,000 to $169,000 for partial contribution.
4). A Roth IRA is beneficial mainly because it is invested using already taxed money, so you won't have to pay taxes upon withdraw.

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