2026 IRA Contribution Decision Calculator: Deductible, Nondeductible, Direct Roth & Backdoor Roth
Compare four 2026 IRA routes — Deductible Traditional, Nondeductible Traditional, Direct Roth, and Backdoor Roth — side-by-side with a Form 8606 pro-rata estimate and a deterministic decision guide.
Route to investigate: Deductible Traditional modeled higher
At equal out-of-pocket cost, modeled after-tax value — Deductible Traditional $34600 vs same-cost Direct Roth $31750 — differs by $2849 over 25 years at 7% return.
This assumes a constant 15% retirement rate vs 22% current rate. It is an educational estimate, not a tax recommendation.
| Route | Status | Amount | Tax saving | Projected after-tax¹ | Form 8606 | Notes |
|---|---|---|---|---|---|---|
| Deductible Traditional | Full deduction available | $7,500 | $1,650 | $34,600 | Not required (fully deductible) | — |
| Nondeductible Traditional | Available as nondeductible basis | $7,500 | $0 | $35,725 | Required | — |
| Direct Roth | Full direct Roth available | $7,500 | $0 | $40,706 | Not required | — |
| Backdoor Roth | Available (no conversion entered) | $7,500 | $0 | $0 | Required (nondeductible contribution) | — |
¹ Single-contribution projected value to retirement; illustrative estimate, not a return forecast.
- You are contributing the full annual limit — any Roth IRA contribution this year would reduce the limit remaining for this account (the limit is shared).
- The $1,100 age-50 catch-up switches on in the year you turn 50, so later years in the schedule can contribute more.
Year-by-year projection
| Year | Age | Contribution | Deductible | Nondeductible | Basis | Gross balance | After-tax | Today's $ |
|---|---|---|---|---|---|---|---|---|
| 1 | 40 | $7,500 | $7,500 | $0 | $0 | $29,138 | $24,767 | $24,767 |
| 2 | 41 | $7,500 | $7,500 | $0 | $0 | $38,915 | $33,078 | $33,078 |
| 3 | 42 | $7,500 | $7,500 | $0 | $0 | $49,377 | $41,970 | $41,970 |
| 4 | 43 | $7,500 | $7,500 | $0 | $0 | $60,571 | $51,485 | $51,485 |
| 5 | 44 | $7,500 | $7,500 | $0 | $0 | $72,548 | $61,666 | $61,666 |
| 6 | 45 | $7,500 | $7,500 | $0 | $0 | $85,365 | $72,560 | $72,560 |
| 7 | 46 | $7,500 | $7,500 | $0 | $0 | $99,078 | $84,216 | $84,216 |
| 8 | 47 | $7,500 | $7,500 | $0 | $0 | $113,751 | $96,688 | $96,688 |
| 9 | 48 | $7,500 | $7,500 | $0 | $0 | $129,451 | $110,033 | $110,033 |
| 10 | 49 | $7,500 | $7,500 | $0 | $0 | $146,250 | $124,313 | $124,313 |
| 11 | 50 | $7,500 | $7,500 | $0 | $0 | $164,226 | $139,592 | $139,592 |
| 12 | 51 | $7,500 | $7,500 | $0 | $0 | $183,459 | $155,940 | $155,940 |
| 13 | 52 | $7,500 | $7,500 | $0 | $0 | $204,039 | $173,433 | $173,433 |
| 14 | 53 | $7,500 | $7,500 | $0 | $0 | $226,059 | $192,150 | $192,150 |
| 15 | 54 | $7,500 | $7,500 | $0 | $0 | $249,621 | $212,178 | $212,178 |
| 16 | 55 | $7,500 | $7,500 | $0 | $0 | $274,832 | $233,607 | $233,607 |
| 17 | 56 | $7,500 | $7,500 | $0 | $0 | $301,808 | $256,537 | $256,537 |
| 18 | 57 | $7,500 | $7,500 | $0 | $0 | $330,672 | $281,072 | $281,072 |
| 19 | 58 | $7,500 | $7,500 | $0 | $0 | $361,557 | $307,324 | $307,324 |
| 20 | 59 | $7,500 | $7,500 | $0 | $0 | $394,604 | $335,413 | $335,413 |
| 21 | 60 | $7,500 | $7,500 | $0 | $0 | $429,964 | $365,469 | $365,469 |
| 22 | 61 | $7,500 | $7,500 | $0 | $0 | $467,799 | $397,629 | $397,629 |
| 23 | 62 | $7,500 | $7,500 | $0 | $0 | $508,283 | $432,040 | $432,040 |
| 24 | 63 | $7,500 | $7,500 | $0 | $0 | $551,600 | $468,860 | $468,860 |
| 25 | 64 | $7,500 | $7,500 | $0 | $0 | $597,950 | $508,257 | $508,257 |
How this calculator works — the formula
The engine works in five steps, all on the 2026 IRS figures:
- Allowed contribution = the smallest of the amount you intend to contribute, your taxable compensation, the age-based limit ($7,500 under 50, $8,600 at 50+), and the combined capacity remaining after any contributions already made this year.
- Deductible share follows IRS Publication 590-A Worksheet 1-2: if you or your spouse is covered by a workplace plan and your MAGI is inside the phase-out band, the deduction is the limit × (top of the band − MAGI) ÷ band width, rounded up to the next $10 with a $200 minimum, capped at what you contributed.
- Roth eligibility follows the same partial-contribution worksheet applied to the Roth phase-out bands from IRS Notice 2025-67. When your Roth MAGI is inside the band, the maximum direct Roth contribution is rounded up to the next $10 with a $200 minimum.
- Pro-rata estimate follows the mechanics of the most recently published IRS Instructions for Form 8606: nontaxable ratio = basis pool ÷ (aggregate year-end non-Roth IRA balances + planned conversion + other distributions), clamped to 1. No 2026-specific Form 8606 was published as of the implementation date.
- Growth compounds twelve equal end-of-month contributions to your retirement age at a constant return net of fees; after-tax value taxes only the portion above basis at your assumed retirement rate.
Worked example (recomputed live below): A 40-year-old with $20,000 saved who contributes the $7,500 limit while not covered by a workplace plan deducts the full amount, saving about $1,650 now at a 22% rate. Over 25 years at 7% the balance grows to roughly $597,950 before tax; taxing that at an assumed 15% leaves about $508,257 after tax — the number that actually reaches your pocket.
Four routes, one decision — how to read the decision guide
Two questions about Traditional IRAs are often confused. Eligibility to contribute is broad: with earned income you can put money into a Traditional IRA at almost any income level. Eligibility to deduct is narrower and depends on workplace-plan coverage and MAGI. A high income does not stop you contributing to a Traditional IRA — it can only make the contribution nondeductible.
The decision guide uses a deterministic rule: it compares the modeled after-tax value of a deductible Traditional IRA contribution versus a same-cost Roth contribution, checks whether direct Roth contributions are available at your Roth MAGI, and evaluates the pro-rata ratio for a backdoor conversion. It reports a "route to investigate" — not a recommendation. Tax rate assumptions, actual Roth eligibility, and the true Form 8606 calculation must be confirmed with a tax professional.
Deductibility depends on coverage and income, not just income
A Traditional IRA contribution ($7,500, or $8,600 with the age-50 catch-up, in 2026) is fully deductible when neither you nor your spouse is an active participant in a workplace retirement plan — regardless of how much you earn.
If you are covered at work, the deduction phases out over a MAGI band that depends on filing status: $81,000-$91,000 for single or head of household, $129,000-$149,000 for married filing jointly, and $0-$10,000 for married filing separately in 2026.
If you are not covered but your spouse is and you file jointly, a separate, higher band of $242,000-$252,000 applies to you. Above the top of the applicable band the deduction is zero, but the contribution itself is still allowed as nondeductible basis.
Nondeductible basis, Form 8606, and the backdoor Roth
When a contribution is not deductible it still grows tax-deferred, and the after-tax dollars you put in become basis you report on Form 8606. At withdrawal only the earnings are taxable — the basis comes back out tax-free.
Some high earners contribute a nondeductible amount and then convert it to a Roth IRA (the 'backdoor Roth'). This tool models the pro-rata Form 8606 estimate for that scenario based on the year-end balances you enter.
The pro-rata rule is the catch: a conversion is taxed in proportion to the basis-versus-pre-tax mix across all your Traditional, SEP and SIMPLE IRAs, so a large pre-tax rollover balance can make most of a conversion taxable. Rolling those balances into an employer plan before year-end can remediate the ratio — the illustrative rollover scenario in this tool shows the effect.
Required minimum distributions and withdrawals
The projected gross balance is a pre-tax figure. Because Traditional IRA withdrawals are taxed as ordinary income, the spendable amount is lower — which is why this tool leads with the after-tax estimate rather than the gross balance.
Traditional IRAs are subject to required minimum distributions, but there is no single start age for everyone: under SECURE 2.0 the applicable age is generally 73 or 75 depending on your year of birth. This calculator projects the balance only up to your retirement age — it does not model RMDs, post-retirement withdrawals, or the order in which basis comes out.
At withdrawal, distributions are taxed pro-rata across all of your Traditional, SEP and SIMPLE IRAs, so nondeductible basis is recovered gradually via Form 8606 rather than all at once. The real spendable value therefore depends on your whole IRA picture, not this account alone.
2026 IRA phase-out ranges (MAGI)
Traditional deduction phase-outs apply only if you or your spouse is covered by a workplace retirement plan. Roth phase-outs apply to direct contributions regardless of workplace coverage.
| Situation | Full contribution / deduction below | Phase-out range | No contribution / deduction above |
|---|---|---|---|
| Traditional — covered single / HoH | $81,000 | $81,000 – $91,000 | $91,000 |
| Traditional — covered MFJ | $129,000 | $129,000 – $149,000 | $149,000 |
| Traditional — covered MFS | $0 | $0 – $10,000 | $10,000 |
| Traditional — not covered, spouse covered MFJ | $242,000 | $242,000 – $252,000 | $252,000 |
| Roth — single / HoH / MFS lived apart | $153,000 | $153,000 – $168,000 | $168,000 |
| Roth — MFJ | $242,000 | $242,000 – $252,000 | $252,000 |
| Roth — MFS lived together | $0 | $0 – $10,000 | $10,000 |
Contribution limit 2026: $7,500 under 50, $8,600 at 50+ (a $1,100 catch-up), shared across all Traditional and Roth IRAs. Source: IRS IR-2025-111 and Notice 2025-67.
Sensitivity — after-tax balance by return and retirement tax rate
Each cell is the estimated after-tax balance at retirement; the highlighted centre cell matches your main result.
| Retirement tax ↓ / return → | 5% return | 7% return | 9% return |
|---|---|---|---|
| 10% tax | $390,430 | $538,155 | $750,163 |
| 15% tax | $368,739 | $508,257 | $708,488 |
| 20% tax | $347,049 | $478,360 | $666,812 |
Automated calculation test cases
Each row is recomputed live by the same engine the calculator uses and is covered by an automated test (engine v2.0.0). These are technical regression checks — they are not an independent professional review of the underlying tax figures.
| Case | Allowed | Deductible | Nondeductible | After-tax at retirement |
|---|---|---|---|---|
| Under 50, at the limit | $7,500 | $7,500 | $0 | $685,976 |
| Age 50+, catch-up | $8,600 | $8,600 | $0 | $271,407 |
| Full deduction (not covered) | $7,500 | $7,500 | $0 | $466,401 |
| Partial deduction (single covered) | $7,500 | $3,750 | $3,750 | $521,082 |
| No deduction (single covered) | $7,500 | $0 | $7,500 | $507,651 |
| Compensation cap | $4,000 | $4,000 | $0 | $548,992 |
| Existing basis | $7,500 | $0 | $7,500 | $428,928 |
| Zero return | $7,500 | $7,500 | $0 | $176,375 |
Frequently Asked Questions
What is the 2026 Traditional IRA contribution limit?
For 2026 the limit is $7,500, or $8,600 if you are 50 or older by year-end (a $1,100 catch-up). This limit is shared across all your Traditional and Roth IRAs combined, and you cannot contribute more than your taxable compensation for the year.
Can I always deduct a Traditional IRA contribution?
No. If neither you nor your spouse is covered by a workplace retirement plan, the contribution is fully deductible at any income. If you are covered, the deduction phases out over a MAGI range set by your filing status; above the top of the range you can still contribute, but the contribution is nondeductible.
What are the 2026 Traditional IRA deduction phase-out ranges?
For a covered single or head-of-household filer the range is $81,000 to $91,000 MAGI; for a covered filer who is married filing jointly it is $129,000 to $149,000; married filing separately is $0 to $10,000. If you are not covered but your spouse is and you file jointly, the range is $242,000 to $252,000.
What are the 2026 Roth IRA income limits?
For 2026, direct Roth IRA contributions phase out over a MAGI range of $153,000 to $168,000 for single filers, head of household, and married filing separately (lived apart); $242,000 to $252,000 for married filing jointly; and $0 to $10,000 for married filing separately (lived together). Above the upper limit no direct Roth contribution is allowed, but a backdoor Roth (nondeductible Traditional contribution then conversion) remains available. Source: IRS Notice 2025-67.
What happens to nondeductible contributions?
They become basis, tracked on IRS Form 8606, and are not taxed again when withdrawn. Only the earnings on them are taxable. Because distributions draw pro-rata across all your Traditional, SEP and SIMPLE IRAs, basis usually comes out gradually rather than all at once.
What is a backdoor Roth IRA?
A backdoor Roth is a two-step manoeuvre: you first make a nondeductible Traditional IRA contribution (which is always allowed as long as you have earned income and remain under the combined limit), then convert that contribution to a Roth IRA. The conversion is subject to the pro-rata rule — if you hold other pre-tax Traditional, SEP or SIMPLE IRA balances at year-end, a portion of the conversion becomes taxable. This tool models the pro-rata estimate based on the balances you enter, but actual taxability must be computed on Form 8606.
What is the pro-rata rule for IRA conversions?
The pro-rata rule (IRS Form 8606) says that when you convert Traditional IRA funds to Roth, the taxable portion is determined by the ratio of pre-tax (non-basis) dollars across all your Traditional, SEP and SIMPLE IRAs — not just the account being converted. Formula: taxable ratio = (aggregate year-end non-Roth IRA balance + distributions) − basis) / (aggregate year-end non-Roth IRA balance + distributions). A large pre-tax rollover balance can make most of a conversion taxable even if the new contribution itself was nondeductible. Rolling those balances into an employer plan before year-end can reduce this ratio.
Does this calculator model required minimum distributions?
No. It projects the balance up to retirement only. Required minimum distributions generally begin at age 73 or 75 depending on your year of birth under SECURE 2.0, and post-retirement withdrawals, RMDs and the pro-rata rule are outside the scope of this estimate.
Data Sources & Benchmarks
- U.S. Internal Revenue Service — Traditional IRA contribution limit, catch-up, and deduction phase-out ranges for tax year 2026 (IRA limit $7,500; age-50 catch-up $1,100; total $8,600; deduction phase-outs — covered single/HoH $81,000-$91,000, covered MFJ $129,000-$149,000, married filing separately $0-$10,000, not-covered spouse-of-covered MFJ $242,000-$252,000). Announced in IR-2025-111 and Notice 2025-67. Partial-deduction figured per Publication 590-A Worksheet 1-2: round the reduced deduction up to the next multiple of $10, minimum $200. · effective November 13, 2025 · retrieved July 13, 2026
- U.S. Internal Revenue Service — Roth IRA direct contribution phase-out ranges for tax year 2026 — Single/HoH/MFS-apart $153,000–$168,000; Married filing jointly $242,000–$252,000; MFS lived with spouse $0–$10,000. Partial contribution procedure: round reduced amount up to next $10, minimum $200. · effective November 13, 2025 · retrieved July 24, 2026 · pending editorial verification
- S&P Dow Jones Indices — S&P 500 Index — Long-Run Annualized Total Return · effective December 31, 2025 · retrieved May 16, 2026
- U.S. Bureau of Labor Statistics — Consumer Price Index for All Urban Consumers — All Items, 12-Month Change · effective April 30, 2026 · retrieved May 16, 2026
Suggest an improvement
Found a calculation issue, outdated source, unclear assumption, or missing edge case? Send a short note so we can review it.
Evidence, sources and editorial review
2026 IRA Contribution Decision Calculator: Deductible, Nondeductible, Direct Roth & Backdoor Roth groups its evidence and methodology review here so sources, assumptions and responsibility can be checked together.
References & Authoritative Sources
- U.S. Internal Revenue Service — 401(k) limit increases to $24,500 for 2026, IRA limit increases to $7,500 (IR-2025-111) · consulted November 13, 2025 · 2026 IRA contribution limit, catch-up, and deduction phase-out ranges
- U.S. Internal Revenue Service — Notice 2025-67 — 2026 amounts relating to retirement plans and IRAs · consulted November 13, 2025 · Official cost-of-living adjustment notice for tax year 2026; source of Roth IRA phase-out ranges
- U.S. Internal Revenue Service — Publication 590-A — Contributions to IRAs (Worksheet 1-2) · consulted July 13, 2026 · Partial-deduction procedure and reduced Roth contribution worksheet: round up to the next $10, $200 minimum
- U.S. Internal Revenue Service — Publication 590-B — Distributions from IRAs · consulted July 13, 2026 · RMD rules and the SECURE 2.0 age-73/75 start; pro-rata and basis recovery
- U.S. Internal Revenue Service — Instructions for Form 8606 — Nondeductible IRAs · consulted July 24, 2026 · Pro-rata rule mechanics for conversions and distributions; no 2026 Form 8606 published as of implementation date
Methodology & Review
Engine version: 2.0.0 · Last updated:
Data status: the 2026 IRS figures come from official IRS sources (IR-2025-111, Notice 2025-67, Publication 590-A) and pass the automated checks, but human editorial sign-off is still pending — treat the figures as provisional. This tool is educational and not tax advice.
Independent professional review: Not independently reviewed by a credentialed U.S. tax professional.
Applies the 2026 IRS contribution limit and deduction phase-out ranges (IR-2025-111, Notice 2025-67, Publication 590-A). The current-year limit depends on your age on December 31, 2026, so the $1,100 catch-up applies once you are at least 50 by the end of the tax year; in the projection your age is incremented for each contribution year while the 2026 dollar thresholds are held constant. The allowed contribution is capped at the lesser of the amount requested, the compensation available, and that year's age-based limit; the deductible share follows the Worksheet 1-2 partial-deduction procedure. The Roth eligibility worksheet (Pub 590-A) applies the phase-out ranges from Notice 2025-67. The Form 8606 pro-rata estimate uses aggregate year-end Traditional, SEP, and SIMPLE IRA balances and is based on the most recently published IRS Instructions for Form 8606; no 2026-specific Form 8606 had been published as of the implementation date. The employer-plan rollover scenario is illustrative only. Growth compounds 12 equal end-of-month contributions at a constant return net of fees, then taxes only the portion above basis at the assumed retirement rate.
Assumptions & limitations — an educational estimate, not tax advice:
- MAGI, workplace-plan coverage, tax rates and deductibility are held constant across the projection; the age-based contribution limit is the one exception — the $1,100 catch-up switches on in the year you reach 50.
- Future IRS contribution limits and phase-outs are not projected — the 2026 dollar figures are held constant throughout.
- For married filing jointly, the spousal (Kay Bailey Hutchison) rule lets a low-earning spouse contribute using the couple's combined compensation less the other spouse's IRA contributions. Married filing separately follows the $0–$10,000 band when you lived with your spouse during the year, and is treated as single when you did not.
- The deduction estimate uses your MAGI directly; it does not run the Social-Security-benefit worksheet (IRS Pub 590-A Appendix B) and assumes no IRA distribution in the contribution year — either can change MAGI or the applicable worksheet.
- The pro-rata estimate uses the year-end balances you enter and the mechanics of the most recently published IRS Instructions for Form 8606. No 2026-specific Form 8606 was published as of the implementation date. Actual taxable amounts must be computed on Form 8606.
- The employer-plan rollover scenario is illustrative only — eligibility to roll Traditional/SEP/SIMPLE balances into a specific employer plan depends on that plan's rules.
- RMDs and post-retirement withdrawals are not modelled.
- The taxable-account comparison is simplified: it reduces the return by an estimated drag and does not model tax lots, capital-gain deferral, qualified dividends, state taxes or asset location.
- The Roth five-year clock, early-withdrawal penalties, recharacterizations, inherited IRAs, and Roth conversion ladders are out of scope.
Reviewed according to the CalcDomain Editorial Policy & Calculator Methodology. We document formulas, edge cases, sources, update dates, and correction paths for calculator pages.
Related Calculators
Embed this calculator
Add this calculator to your website for your readers. The embed includes a neutral attribution link to the original CalcDomain page for methodology, updates, and source notes.
Attribution uses rel="nofollow" by default and is included for transparency, not ranking manipulation.