Can an Individual Make Both IRA & Simple IRA Contributions?

Limits apply to tax deductions on IRAs.

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If you’re intent on maximizing your retirement savings using tax-advantaged retirement plans, you need to know the rules for how much you can contribute to each plan and which contribution limits are cumulative. For example, if you have an employer who offers a SIMPLE IRA to help employees save, you can use both the SIMPLE IRA and a traditional or Roth IRA in the same year to boost your nest egg. However, if you go over the contribution limits, you would owe the Internal Revenue Service 6 percent of the excess contribution every year until the extra contribution is corrected.


Although you are able to make both traditional or Roth IRA and Simple IRA Contributions in the same year, the amount you can contribute varies depending upon your age, the type of IRA you have and limits set forth by the IRS.

IRA Contribution Limits

Contributions to a traditional or Roth IRA are limited to $6,000 as of 2019, but if you’re 50 or older, you can contribute up to $7,000. But you must have at least as much as your contribution in taxable compensation, like wages, salaries, bonuses or net self-employment income. For traditional IRAs, you must also be younger than 70 ½ years old at the end of the calendar year. For Roth IRAs, your income can’t exceed the limits for your filing status.

The contribution limit is cumulative for both traditional and Roth IRAs. This means that your total across the two accounts can’t exceed your annual contribution limit. For example, if you’re under 50 years old in 2019 and you contribute $3,000 to your Roth IRA, you can’t contribute more than $3,000 to your traditional IRA. However, the contribution limits are completely separate from the limits for a SIMPLE IRA.

SIMPLE IRA Contribution Limits

SIMPLE IRAs function similarly to 401(k) plans in that both employees and employers can make contributions to the plan. As of 2019, the maximum you’re allowed to contribute to your SIMPLE IRA is $13,000 if you’re under 50 or $16,000 if you’re 50 or older.

SIMPLE IRA contribution limits are not cumulative with traditional and Roth IRA limits. However, SIMPLE IRA limits are cumulative with the contribution limits for other employer-sponsored plans, such as 401(k) plans and 403(b) plans.

Your total contributions to such plans can’t exceed $19,000 if you’re under 50 or $25,000 if you’re 50 or older as of 2019. For example, assume you work two jobs and one employer offers a SIMPLE IRA and the other offers a 401(k) and you’re under 50 years old. If you contribute the $12,500 maximum to your SIMPLE IRA, you can’t contribute more than $6,500 to your 401(k) plan at your second job.