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A tale of two types of IRA contributions

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in Small Business Tax

Q. I have both a regular IRA and a Roth. Can I contribute to each one in 2014? M.C.H., Cleveland

A. Yes, as long as you meet the tax law requirements. For 2014, the maximum contribution allowed for any combination of IRAs is the lesser of $5,500 ($6,500 if age 50 or older) and your taxable compensation. You can divide up your annual contribution any way you see fit. But note that deductions for traditional IRA contributions are limited or eliminated for certain active participants in employer plans while eligibility for Roth contributions phases out for upper-income taxpayers.

Tip: The annual contribution limit for IRAs remains the same for 2015. 

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