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What is the contribution limit for a Traditional IRA in 2025?

 For the 2025 tax year, the IRS has increased the contribution limits for Traditional IRAs to help individuals save more for retirement.

• If you are under age 50, you can contribute up to $7,000.

• If you are age 50 or older, you are eligible for a catch-up contribution of an additional $1,000, bringing your total annual limit to $8,000.

These contribution limits apply per individual, not per account. That means if you have multiple IRA accounts (Traditional or Roth), the total amount you contribute to all IRAs combined cannot exceed these annual limits.

Key Things to Know:

• Earned Income Requirement: You must have taxable earned income (like wages, salaries, or self-employment income) at least equal to the amount you contribute.

• Deadline to Contribute: Contributions for the 2025 tax year can be made until the tax filing deadline in April 2026 (typically April 15, unless it falls on a weekend or holiday).

• Tax Deductibility: Traditional IRA contributions may be fully or partially deductible based on your income level, tax filing status, and whether a workplace retirement plan covers you or your spouse.

• Combined IRA Limit: The $7,000 or $8,000 limit represents the total contribution amount across all IRAs (Traditional and Roth combined).