2022 Roth IRA Contribution Limit Stays Put Despite 401(k) Lift

For the 2022 calendar year, IRA contributions aren't rising like those of 401(k)s. What's changing?

Rachel Curry - Author

Nov. 5 2021, Published 2:49 p.m. ET

On Nov. 4, the IRS announced new contribution limits for certain accounts, but Roth IRAs weren't one of them. Still, the organization is raising the income limit for Roth IRAs, which means that certain high earners will be able to contribute more cash during the year.

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Here's the low-down on the upcoming Roth IRA contribution and income limits—plus how people investing for retirement can get the most bang for their buck.

IRS raises 401(k) contribution limit, keeps IRA contribution limits stable

In 2022, people with a 401(k) and similar retirement accounts will be able to save an additional $1,000 for their retirement. The shift is based on increases in the cost of living (the 5.4 percent inflation rate in the 12 months ending in September).

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In 2021, the maximum 401(k) contribution is $19,500, which will increase to $20,500 in 2022. The rule also applies to 403(b)s, most 457 plans, and TSPs (Thrift Savings Plans). The $6,500 catch-up contribution for people 50 years and older remains the same.

People who save for retirement via IRAs aren't quite so lucky. IRA contribution limits are staying put, with the maximum contribution for traditional and Roth IRAs sticking to $6,000. For 50-and-older contributors, the catch-up contribution remains $7,000.

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Roth IRA investors get a higher income limit

Currently, the maximum income a Roth IRA saver can make in order to contribute to their account is $125,000 for individuals and heads of households or $198,000 for married couples filing jointly. Similarly, Roth IRA eligibility phases out fully at $140,000 for individuals and $208,000 for married couples.

For 2022, the rules are changing slightly. Individuals and heads of household will have a maximum income for full contributions of $129,000 and a phase-out income of $144,000, up $4,000 each.

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Married couples will have a maximum income for full contributions of $204,000 and a phase-out income of $214,000—an increase of $6,000 each.

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Traditional IRA income limits for deductible contribution eligibility are also increasing. For people who want to continue using a Roth IRA despite having over-the-limit income, there's always a back-door Roth IRA, in which high-earning investors contribute to a traditional IRA (and get the up-front tax break that comes with it). They convert their contributions (up to $6,000 per year) to a Roth because a transfer that takes place between two retirement accounts doesn't get taxed.

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There are specific rules about how to do this right (the method is called a "reverse rollover") if you don't want to get checked by the IRS's pro-rata rule that forces all of your assets to be considered as a whole.

Self-employed? Here's how you can contribute more than a Roth IRA allows

Most traditionally employed individuals have a 401(k) or similar employer-provided fund. However, self-employed people are more likely to use IRAs. For self-employed people, a SEP (Simplified Employee Pension) IRA lets you contribute the lesser of $61,000 or 25 percent of your income in 2022 (up from $58,000 this year).

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For six-figure earners, that translates to a contribution limit of $25,000+ per year—much higher than the traditional or Roth IRAs. Unfortunately, SEP IRAs don't have a back-end tax break like Roth IRAs, but the contribution conditions make it a powerhouse for retirement savings and tax deductions.

Solo 401(k)s are also an option for self-employed people seeking higher contribution limits in 2022.


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