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IRA Age Limits - Minimum and Maximum Ages for IRA Contributions

IRA Age Limits Apply to Traditional IRAs But Not to ROTH IRAs

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Is there an IRA age limit for making IRA contributions? It depends on which type of IRA you are talking about.

Maximum Age Limit for IRA Contributions

  • ROTH IRA - There is no upper age limit to make a contribution to a ROTH IRA.

  • Traditional IRA - For a Traditional IRA, once you reach the year in which you turn age 70 ½ you are no longer eligible to make a Traditional IRA contribution.

No IRA Age Limit on IRA Rollovers or Transfers!

Don’t confuse IRA contributions with an IRA rollover or transfer. Some retirees mistakenly think they cannot open an IRA account and then roll their lump sum pension distribution or 401k plan to the IRA because they exceed the IRA age limit. This is incorrect!

An IRA contribution is not the same thing as an IRA rollover or IRA transfer. When you move money from a company sponsored retirement plan (such as a 401k or 403b) directly to an IRA that is called a rollover. You can do this at any age.

When you transfer money from one IRA to another IRA it is called an IRA transfer and you can do this at any age.

A contribution is new money that was not in a tax-deferred account that is going into an IRA. The upper age limit on Traditional IRAs applies only to contributions; not to rollovers or transfers.

According to the IRS Retirement Plans Page, “You can’t make regular contributions to a traditional IRA in the year you reach 70½ and older. However, you can still contribute to a Roth IRA and make rollover contributions to a Roth or traditional IRA regardless of your age.”

Do not confuse ROTH conversions with contributions either. There is no upper age limit on your ability to convert Traditional IRA assets to a ROTH IRA. You can do this at any age.

Spousal IRA Contributions

Many people are not aware that they can make a spousal contribution to an IRA on behalf of a non-working spouse as long as they have enough earned income. If your tax bracket warrants contributing to a Traditional IRA instead of a ROTH IRA and you are reaching the Traditional IRA age limit of 70 ½, if your spouse is younger than you, you should still be able to make what is called a Spousal IRA contribution to their Traditional IRA. Spousal IRA contributions to Roth IRAs are also allowed.

Minimum Age Limit for IRA Contributions

There is not a minimum age limit to make any type of IRA contribution. However to be eligible to make any type of IRA contribution you must have earned income in an amount that equals or excess your IRA contribution. Earned income is income that is considered taxable compensation – income from wages that you worked for.

For minors, as a general rule, income earned from household chores doesn’t count. See ROTH IRAs for Minors for additional details on IRA contributions for minors.

Other Age Related IRA Rules

There are two additional age-related IRA rules that all IRA account holders should know.

1. Age 59 ½ - this is the age at which you can access your IRA money and take withdrawals and the IRA early withdrawal penalty tax will not apply. (Note: there are a few exceptions to the IRA early withdrawal penalty.) This applies primarily to Traditional IRAs, but can apply to some ROTH IRA money. See When ROTH IRA Withdrawals Are Tax Free – And When They Are Not for details.

2. Age 70/12 – this is the age at which you must begin to take withdrawals from Traditional IRAs and most qualified retirement plan money (such as 401ks, 403bs, SEPs, etc.). These withdrawals are called required minimum distributions. Required minimum distribution rules do not apply to ROTH IRAs, however they do apply to Designated ROTH Accounts offered in a 401k plan.

To learn more about IRAs see All About IRAs.

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