IRA Contribution Limits

While it is generally desirable to stash away money for retirement, you cannot put away everything you earn and expect to enjoy the tax breaks from an IRS. If you are 49 and younger, you can put away as much as $5,000, and from 2012 onwards this amount becomes linked to inflation. If you’re 50 and older, you get to put away an extra $1,000. The limits are also adjusted for inflation from 2012 onwards. If you fail to contribute the maximum in a given year, you can’t carry forward the unused portion and add it to your annual limit. You either use it or lose it. While you may be eligible to contribute to both a traditional IRA and a Roth IRA, the total can’t exceed these stipulated limits.