Roth Excess with Low MAGI
blueberry
Member Posts: 1 Newcomer
Does 1099 income not quality for Roth contribution? My MAGI for 2023 is around $7000, all from 1099-B, 1099-Int, and 1099-Div. However, when I try to enter my Roth contribution as $6500 for 2023, I am notified that I am in excess of $6500.
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Hi blueberry,
"For 2023, the total contributions you make each year to all of your traditional IRAs and Roth IRAs can't be more than:
- $6,500 ($7,500 if you're age 50 or older), or
- If less, your taxable compensation for the year"
Taxable compensation is generally from earned income (ex/ wages, self-employment income, etc.). The IRS specifically excludes interest, dividends, pension, etc. You can find what is considered compensation for the purposes of the IRA contribution limit on Table 1-1.
