IRA Contribution Calculator: Roth, Traditional, and SEP

Input your information below and see an estimate of how much you can contribute to a Traditional, Roth, and SEP IRA account this year. Keep in mind, your individual tax circumstances are unique and you should consult a qualified tax advisor prior to making a contribution.

This is not a recommendation of any account type, contribution amount, investment strategy, nor a recommendation to buy, hold, or sell any security.

Calculate your IRA contribution limits for 2024

How the calculator works:

• Traditional IRA contribution limit: To calculate the traditional IRA contribution limits, the calculator first determines the individual’s age, as those who are 50 years old or older can make additional catch-up contributions. Next, it assesses the individual’s income level and filing status to apply the appropriate income phase-out ranges, which can affect the deductible amount of the IRA contributions. The calculator then checks if the individual or their spouse is covered by a retirement plan at work, as this also impacts the deductibility of contributions. Finally, the calculator uses this information to determine the maximum contribution amount that can be deducted for the tax year. Calculations based on figures from the IRS: Contributions to Individual Retirement Arrangements (IRAs)

• Roth IRA contribution limit: To calculate Roth IRA contribution limits, the calculator first assesses the individual’s filing status and modified adjusted gross income to determine eligibility, as Roth IRAs have income limits. Next, it checks the individual’s age to see if they qualify for catch-up contributions, which are additional contributions allowed for those 50 years old or older. The calculator then uses this information to determine the maximum contribution amount for the year, keeping in mind that contributions to a Roth IRA are made with after-tax dollars and are not tax-deductible. Calculations based on figures from the IRS: Contributions to Individual Retirement Arrangements (IRAs)

• SEP IRA contribution limit: To calculate the SEP IRA contribution limit, the calculator adjusts the net profit by reducing it by the deductible portion of the self-employment (SE) tax and the amount of the individual’s own retirement plan contribution. This adjusted net profit is then used to determine the plan compensation, which is necessary for calculating the SEP IRA contribution. Calculations based on figures from the IRS: Self-employed individuals: Calculating your own retirement plan contribution and deduction

Understanding IRA Contribution Limits

By using our IRA Contribution Calculator above you can learn more about how much you can contribute this year to each retirement account:

Traditional IRAs

A traditional IRA (individual retirement account) is a tax-deferred retirement account that you can open and fund yourself. This account is not through an employer. It’s considered tax-deferred because contributions are typically deductible from your income (see exceptions below), but you will owe income tax on withdrawals.

Traditional IRA annual contribution limits for tax years 2024 and 2025 are $7,000, or $8,000 if you are age 50 or older. Contributions you make to a traditional IRA may be fully or partially deductible, depending on your filing status, income, and whether you or your spouse are covered by a retirement plan at work.

Generally, funds in your traditional IRA are not taxed until you take a distribution (withdrawal) from your IRA after the age of 59 ½. Early withdrawals are subject to taxes and in some cases an additional 10% penalty.

Learn more: What Is an IRA? Types and Benefits, Explained

Roth IRAs

A Roth IRA is also a retirement account that you open and fund yourself (not through an employer). However, this account is different from a traditional IRA because you contribute after-tax money to a Roth IRA — meaning contributions are not deductible, but qualified withdrawals are tax free.

A Roth IRA can be beneficial from a tax standpoint, as long as you don’t exceed the income cap for these accounts. You can contribute to a Roth IRA at any age, and you don’t have to take required minimum distributions (RMDs). If you meet the requirements and hold the account for at least five years, your contribution amounts and earnings can be withdrawn tax free after age 59 ½.

Roth IRA annual contribution limits for tax years 2024 and 2025 are $7,000 per year, or $8,000 if you are age 50 or older.

Learn more: What Is a Roth IRA and How Does It Work?

SEP IRAs

A SEP IRA (Simplified Employee Pension) is a tax-deferred retirement account for small business owners and self-employed people. It’s similar to a traditional IRA in that contributions can be tax deductible, and grow tax-deferred until you take withdrawals in retirement.

SEP plans can provide a significant source of income at retirement by allowing employers to set aside money in retirement accounts for themselves and their employees. A SEP does not have the start-up and operating costs of a conventional retirement plan, and allows for a contribution of up to 25% of each employee’s pay.

Contribution limits for 2024 are: $69,000 per year, or 25% of compensation per employee, whichever is lower. For 2025 the annual limits are $70,000, or up to 25% of compensation per employee, whichever is lower.

There is no catch-up provision for SEP-IRAs, as there is with other types of retirement plans.

SEP IRAs are available to any size business and are easily established by adopting Form 5305-SEPPDF, a SEP prototype, or an individually designed plan document.

Please note: If Form 5305-SEP is used, you cannot have any other retirement plan (except another SEP). There is no filing requirement for the employer and only the employer contributes to traditional IRAs (SEP-IRAs) set up for each eligible employee. Additionally, the employee is always 100% vested in (or, has ownership of) all SEP-IRA money.

Learn more: What Is a SEP IRA and How Does It Work?

More resources.

Next Steps

Ready to invest for your retirement? It’s easy to get started when you open an IRA online with SoFi. SoFi doesn’t charge commissions, but other fees apply (full fee disclosure here).

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