The new year is almost here, so it will soon be time to contribute to your 2008 Roth IRA and Roth 401k. It is exciting as the IRA limits have increased and the Roth 401k is catching on! Here’s the contribution limits for each:
| Roth 401k Contributions | ||||
| Maximum | $ 15,500 | |||
| Catch-up > 50 years old | $ 5,000 | |||
| Roth IRA Contributions | ||||
| Maximum | $ 5,000 | |||
| Catch-up 50 and over | $ 1,000 |
2008 contributions can be made as early as January 2 for the whole year. If you contribute 2008 Roth IRA money before April 15, be sure to designate calendar year 2008 if you have already contributed the maximum for 2007.
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2007 Contributions
2007 Roth 401k contributions can still be made before the end of the year. 2007 Roth IRA contibutions can be made until April 15, 2008. See the 2007 limits for eligible contributions.
Action Plan
I like to invest our Roth IRA money as soon as possible in January. However, due to income phase-outs, we now wait until the end of the tax year to determine our eligibility. We’ll be contributing our 2007 Roth IRA money soon!
See why I’m excited about the Roth 401k again!
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Wow, Good problem to have with the income phase-out. Congrats. I always make it under once I itemize. I did have to switch a Roth-Traditional conversion BACK last year though, because of limitations.
Roth 401k’s rock too! Too bad my company doesn’t offer them (yet).
Randall
December 17th, 2007 at 10:04 pm
@Randall: Unconverting… hope that wasn’t too much paperwork! Luckily, we should make it under no problem this year since I’m on maternity leave. No paycheck= no problem! I’m always nervous to count on the itemizations with the AMT cloud hanging out there.
December 18th, 2007 at 10:00 am