If you are looking for a way to reap the long-term rewards of retirement investing, then look no further than a Roth IRA. Contribution limits for Roth IRAs are established by the Internal Revenue Service, and those limits can make a big difference in the amount of money you can add to your account each year. But just how much can you contribute to a Roth IRA?

Let’s start with the basics: You can contribute up to the lesser of either 100 percent of your earned income, or $6,000 per year to your Roth IRA. That’s $6,000 annually for individuals and $12,000 for those filing jointly. An earned income includes wages, salaries, bonuses, commissions, and self-employment income. Individuals who are 50 or older can add an extra “catch up” contribution of $1,000 per year, bringing the total contribution limit to $7,000 annually.

It is important to note that if you contribute more than the allowed limit, you will be required to pay a 6 percent excise tax on the total amount that exceeds the limit. However, if you mistakenly contribute too much, you may be able to avoid the penalty by withdrawing the p>