Obviously this settles eventually and had I known the earnings on an excess distribution were due in the year of contributions, I could have stopped the game by withdrawing sufficiently enough to offset the contribution limit change from
the increased MAGI, but is this really how it works?
Because your MAGI is in the phase - out range from making a Roth IRA contribution and there are earnings attributable to your excess contribution, you have the problem that you describe: the taxable earnings
increase your MAGI causing even more of your Roth IRA contribution to be excess.
However, these earnings will
increase my MAGI and lower my contribution limit even further.
Not exact matches
As your modified adjusted gross income (
MAGI)
increases, the child tax credit begins to phase out.
The income limits for Roth IRA contributions also
increased: single folks with a
MAGI less than $ 118,000 can make a full contribution, and this is phased out up to a
MAGI of $ 133,000, an
increase of $ 1,000 at each end of the range.
The
MAGI limit for married filing jointly
increased from $ 61,500 to $ 62,000; for singles the limit is unchanged at $ 30,750; and for heads of household, the
MAGI limit is $ 46,500, an
increase from $ 46,125.
For married folks filing jointly who are not covered by a workplace retirement plan but are married to someone who is covered, the
MAGI limit for deduction is $ 186,000, phased out at $ 196,000; this is an
increase of $ 2,000 over 2016's limits.
Your
MAGI equals the AGI you report on your tax return
increased by the amount of your student loan interest deduction.
Your deduction eligibility is gradually reduced and eventually eliminated by phaseout as your modified adjusted gross income (
MAGI)
increases to the annual limit for your filing status.