Can You Have a SIMPLE IRA and a Roth IRA? Yes, Here Is How

Yes. You may make contributions to both a SIMPLE IRA and a Roth IRA for the same tax year. The contribution limits apply separately to each account, therefore your contributions to one will not reduce the amount available for contribution into the other. For 2026 that means you can contribute up to $17,000 in the SIMPLE IRA through your employer as an employee deferral plus up to $7,500 in a Roth IRA, making a total of $24,500 combined before any catch-up contributions.

The only real issue is on the Roth side. A SIMPLE IRA has no income limits. However, there are income limits in place for contributions to a Roth IRA and as such, depending on your level of earnings, you could see an amount that would limit or even eliminate contributions to a Roth IRA while the SIMPLE stays wide open.

Can you have a SIMPLE IRA and a Roth IRA?

Yes. Because a SIMPLE IRA and a Roth IRA are under different areas of the Tax Code, you can contribute to both types of accounts in the same tax year without "crowding" each other out.^[1] The SIMPLE IRA is an employer-sponsored retirement plan that allows employees to defer part of their salary and employers must provide matching contributions on behalf of eligible participants. A Roth IRA, however, is a type of Individual Retirement Account that you establish directly with a financial institution such as a bank or brokerage firm. You would then use after-tax dollars (dollars you have already paid income taxes on) to fund it.

You can fund a Roth SIMPLE IRA plan through payroll. That is a different feature from your personal Roth IRA, and you will still have your full personal Roth IRA contributions available. To be eligible to contribute to a Roth IRA, two things are required. Neither has anything to do with your SIMPLE retirement account. First, you must have enough earned income in the year that covers at least the amount of the contribution that you want to make into a Roth IRA. Second, your modified adjusted gross income must fall within an established limit that determines how much money you may contribute annually toward a Roth IRA.

How much can you contribute to both in 2026?

You can put the entire allowable limit in each account, as they are both derived from different areas of the tax code. Assume you make $60,000 and your employer provides a SIMPLE IRA. During 2026 you will have deferred $17,000 into the SIMPLE plan with an employer contribution of approximately $1,800 (the 3% match) on top of it.^[2] Independently you contribute $7,500, the 2026 Roth maximum, out of your after-tax money.^[3] The total contributed by you is $24,500 for the year, and the employer match is extra room on top of that.

In addition to adding to overall totals for older savers, catch-ups also add a $4,000 catch-up at age 50 and above for SIMPLE ($3,850 at businesses with 25 or fewer employees), and the Roth IRA provides an additional $1,100 catch up. Workers in the 60 to 63 window will receive a $5,250 super catch-up in their SIMPLE instead. The full personal-account figures can be found in the 2026 IRA contribution limits guide.

SIMPLE IRA vs. Roth IRA: how do they differ?

Both accounts have "IRA" in common but that's about it. One is a plan your employer runs as an employee benefit, and the other is a personal retirement savings account you manage yourself. Match who establishes each one, what gets put into them, does income matter when using either of these plans for taxes, and how does your tax liability fall:

You can hold both because of the idea of tax diversification. The SIMPLE defers this year's taxable income (capturing employer matching dollars), while the Roth IRA builds up a pool of money that will be tax free when you retire. One point to clarify regarding the Roth column, $7,500 represents your combined limit for all Traditional IRAs and Roths, therefore if you contribute a dollar to a non-deductible Traditional IRA, that is a dollar of your available Roth contribution space you no longer have. To get an expanded comparison table between the SIMPLE vs personal pre-tax accounts go to SIMPLE IRA vs. traditional IRA.

Does being in a SIMPLE IRA affect Roth IRA eligibility?

No. You can be eligible for both a SIMPLE plan and a Roth IRA, and you do not have to choose one or the other. Your participation in an employer-sponsored retirement plan like a SIMPLE plan will NOT affect your ability to make contributions to a Roth IRA. The rules regarding eligibility for a Roth IRA are based solely upon the income you earn (your "earned income") and your modified adjusted gross income (MAGI).^[4] As such, if you elect to max out your contributions to your SIMPLE account, you would still be able to contribute the maximum allowed amount into a Roth IRA as long as your MAGI remains under the limits at which the Roth phase-outs begin. Workplace coverage does impact the deductible portion of traditional IRA contributions: active participation in a SIMPLE plan impacts what percentage of a traditional IRA contribution may be deducted. However, this has NO bearing on your ability to fund with after-tax dollars through Roth eligibility.^[5]

For 2026 the IRS sets the Roth IRA phase-out between $153,000 and $168,000 of modified AGI for single filers, and between $242,000 and $252,000 for married couples filing jointly.^[3] You can contribute the full $7,500 if your modified AGI is below the lower end of the phase-out range. Anywhere inside the range, your Roth contribution will be reduced from its maximum. Once you go over that upper limit, you cannot contribute directly to a Roth account at all. One way to work with that is using a "lever" on your wage income. A SIMPLE plan allows pre-tax deferrals from paychecks before those monies are included in the Modified AGI the Roth phase-out measures. So a person whose earnings sit just above the range could move back under the limits simply by increasing his/her deferral rate.

What if your income is too high for a Roth IRA?

You can still make some progress toward the Roth goal if you have too much income for direct contributions to a Roth account (i.e., "too much" for the Roth phase-out). The SIMPLE IRA contribution will be unaffected since there are no limits on that based upon income. No matter how much your income goes up, you will still be able to defer the entire $17,000 amount each year. Even though you may have reached the limit on direct contributions to a Roth, this doesn't necessarily mean that your efforts to save money toward a Roth must come to an end. A backdoor Roth IRA allows you to fund a nondeductible traditional IRA and then convert it. As such, even with a limit on direct contributions, you can get money into your account using this method as well. However, when making that conversion under the pro-rata rule, all of your amounts in traditional IRAs (including SEP and SIMPLE) are counted together, therefore having a large balance in your SIMPLE IRA makes the conversion partly taxable. The usual option, to move the pre-tax portion of a SIMPLE into a 401(k), has to wait out the SIMPLE's first 2 years.

The Bottom Line

You can contribute to both a SIMPLE IRA and a Roth IRA within the same tax year because they are two distinct retirement savings accounts with their own contribution limits. In 2026 that stacks $17,000 of SIMPLE deferrals with $7,500 in a Roth IRA for $24,500 before catch-ups. There is no income limit on contributions made to a SIMPLE account. However, there is an income-based phase-out for Roth IRAs based upon Modified Adjusted Gross Income (MAGI). Check your MAGI against the Roth range, and make both contributions wherever possible.

This guide is educational and summarizes IRS rules for SIMPLE IRA and Roth IRA contributions. It is not investment, legal, or tax advice. Your plan documents and current IRS limits control. Talk to your tax advisor about your business's circumstances.