Roth IRA

Anyone who has earned income can have a Roth IRA, as long as their income for a given tax year is neither too high nor too low. If your annual income is above a certain amount, which the IRS adjusts periodically, you become ineligible to contribute.

If you file taxes as a single person, your modified adjusted gross income must be less than $138,000 in 2023 to contribute the full amount. Married couples filing jointly must earn less than $218,000 in 2023.

Above these incomes, the amount that you can contribute to a Roth IRA begins to phase out. Individuals whose MAGI is above $153,000 in 2023, and married couples filing jointly whose MAGI is above $228,000 in 2023, cannot contribute to a Roth IRA.

There is no age restriction for contributions to either Roth or individual retirement accounts (IRAs).

You can now make contributions to traditional IRAs beyond the previous age limit of 70½ years, thanks to the Setting Every Community Up for Retirement Enhancement (SECURE) Act enacted in 2019.

The Internal Revenue Service requires that you have earned income to be eligible to contribute to either type of IRA.

You must start withdrawing a required minimum distribution (RMD) from your tax-deferred retirement accounts, such as a traditional IRA or 401(k) plan, when you turn age 72. Roth IRAs are not subject to RMD rules, but Roth 401(k)s are unless you are still employed at the company that sponsors the plan.

The Roth IRA five-year rule says you cannot withdraw earnings tax-free until it's been at least five years since you first contributed to a Roth IRA account. This five-year rule applies to everyone who contributes to a Roth IRA, whether they're 59 ½ or 105 years old.