Can I contribute to an IRA after 70 years of age? Turbo Tax software let me do it.

[MichelleT · Accepted solution]

No you cannot after age 70.5

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.

https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-ira-contribution-li...

[Chuck48]

Working on my 2019 taxes with Turbo Tax filing as single...

I turned 70.5 in 2019, retired and earned less than $5K on some part-time work. I was told I can invest the equivalent amount I earned into my Roth as it's less than $7K.

But TT tells me my AGI is more than the $137K max and have to reverse the deposit or incur penalty.

Responses please. Thank you.

[macuser_22]

The SECURE ACT signed into law in December 2019 eliminated the age requirement for contribution to a Traditional IRA starting for 2020 contributions (does not apply to 2019 contribution even of made before April 15 2020).   There is now NO age cutoff.

https://www.congress.gov/bill/115th-congress/house-bill/3554

So if this was a 2020 Traditional IRA contribution then as long as you have the necessary taxable compensation (money that you worked for) to qualify for a IRA contribution, TurboTax was correct in allowing it reguardless of age.

(For a simplified explanation of the retirement changes that the SECURE ACT made, see this Fidelity article:

https://www.fidelity.com/learning-center/personal-finance/retirement/understanding-the-secure-act-an...)

[KrisD15]

@Chuck48

You have two things going on, 

1. You need to earn income to contribute to a retirement plan. You pass that

2. Contribution limits are based on your Modified Adjusted Gross Income. If you're filing single, and your MAGI is equal to or more than 137,000, you cannot contribute. 

Who ever said you could invest that was not aware of your other income.

contribution phase out

[dmertz]

If you did not reach age 70 before July 1, 2019, your age is not a factor in being eligible to make a traditional IRA contribution for 2019.  With regard to traditional IRA contributions made for 2020 and beyond, age is not a factor for anyone.