Internal Revenue Service United States Department of the Treasury
Level Basic Advanced Military International

Adjustments to Income Workout

IRA Contributions

Case Study 2: IRA Compensation Requirement

Gene and Sue are married and are both over 50 years old. Gene earned $70,000 and Sue earned $1,500. During the tax year, Gene contributed $3,500 to his traditional IRA and $2,000 to a Roth IRA, making his total contributions $5,500. To figure the maximum contribution to Sue's IRA, use a total compensation of $66,000 (i.e., $71,500 - $5,500). If Gene and Sue file jointly, they can contribute up to $7,500 to Sue's IRA even though her own compensation was just $1,500.

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Photo of 35 year old labeled with dollar amount $6,000. Photo of 65 year old labeled with dollar amount $7,000.