Rule Atlas
IRS · SEE1-5: Retirement Planning: IRA Contribution and Distribution Strategy
Under IRS · SEE1-5 (IRS / Treasury Circular 230), retirement Planning: IRA Contribution and Distribution Strategy establishes the authoritative rules tested on the IRS Enrolled Agent (EA). A comprehensive guide to advising clients on Traditional and Roth IRA contributions, distributions, conversions, and advanced strategies for the 2025 tax year. VoraPrep verifies every threshold, worked table, and practice question below against the current IRS Enrolled Agent (EA) blueprint.
Current Statutory Thresholds & Limits in Effect
Designated Roth 401(k)/403(b) accounts have zero lifetime RMDs starting 2024.
Triggers deposit by the next banking day AND converts monthly depositors to semiweekly status for the remainder of the current and entire next calendar year.
2025 IRA Contribution Limits & Deadlines
| Contribution Type | 2025 Limit | Notes |
|---|---|---|
| Maximum Annual Contribution | $7,000 | This is the combined limit for all Traditional and Roth IRAs. |
| Catch-Up Contribution (Age 50+) | $1,000 | For individuals who are age 50 or older by the end of the tax year. |
| Total for Age 50+ | $8,000 | The sum of the annual limit and the catch-up contribution. |
Mel turned 74 in 2025 and has a traditional IRA with a balance of $500,000 on December 31, 2024. What is her required minimum distribution (RMD) for 2025?
Worked Example: The Pro-Rata Rule Trap in Action
Scenario. Your client, David, age 55, wants to execute a backdoor Roth IRA for 2025. He is a high-income earner and cannot contribute directly to a Roth IRA. Consider these facts:
- David has an existing Traditional IRA with a pre-tax balance of $92,000 from an old 401(k) rollover. In 2025, he makes a $8,000 non-deductible contribution to a new Traditional IRA ($7,000 limit + $1,000 catch-up). He immediately converts the $8,000 from the new IRA to a Roth IRA. The total fair market value of all his non-Roth IRAs on December 31, 2025, is $100,000.
- How much of the $8,000 conversion is taxable?
- Step 1: Aggregate All Non-Roth IRAs. The pro-rata rule (IRC § 408(d)(2)) requires us to treat all of David's Traditional, SEP, and SIMPLE IRAs as a single account for this calculation. Total value of all non-Roth IRAs on 12/31/2025 = $100,000 (This is the denominator for Form 8606, Part I).
- Step 2: Determine Total Basis. David's only after-tax basis in his IRAs is the new non-deductible contribution. Total after-tax basis = $8,000.
Common IRS Enrolled Agent (EA) Distractors on IRS · SEE1-5
- 1Every IRA question on the SEE follows the same underlying structure. Use this 5-step decision framework and you'll rarely miss one:
- 2Step 1. Identify the IRA type and the action. Is it a Traditional or Roth IRA? Is the question about a contribution, a distribution, a conversion, or a rollover? Each action has distinct rules for deductibility, taxability, and penalties.
- 3Scenario. Your client, David, age 55, wants to execute a backdoor Roth IRA for 2025. He is a high-income earner and cannot contribute directly to a Roth IRA. Consider these facts:
- 4David has an existing Traditional IRA with a pre-tax balance of $92,000 from an old 401(k) rollover.
- 5In 2025, he makes a $8,000 non-deductible contribution to a new Traditional IRA ($7,000 limit + $1,000 catch-up).
Frequently Asked Questions: IRS · SEE1-5
What is the core rule under IRS · SEE1-5 (Retirement Planning: IRA Contribution and Distribution Strategy)?
Under IRS · SEE1-5 (IRS / Treasury Circular 230), retirement Planning: IRA Contribution and Distribution Strategy establishes the authoritative rules tested on the IRS Enrolled Agent (EA). A comprehensive guide to advising clients on Traditional and Roth IRA contributions, distributions, conversions, and advanced strategies for the 2025 tax year. VoraPrep verifies every threshold, worked table, and practice question below against the current IRS Enrolled Agent (EA) blueprint.
How is IRS · SEE1-5 tested on the IRS Enrolled Agent (EA)?
Every IRA question on the SEE follows the same underlying structure. Use this 5-step decision framework and you'll rarely miss one: Step 1. Identify the IRA type and the action. Is it a Traditional or Roth IRA? Is the question about a contribution, a distribution, a conversion, or a rollover? Each action has distinct rules for deductibility, taxability, and penalties.
Where can I practice IRS Enrolled Agent (EA) questions on Retirement Planning: IRA Contribution and Distribution Strategy?
Test yourself instantly with the free playable IRS Enrolled Agent (EA) question on this page, or launch VoraPrep's full IRS Enrolled Agent (EA) adaptive question bank, interactive lessons, and 1:1 exam simulator at voraprep.com/ea-prep.