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Investing/Strategies / Retirement Investing
|Subject: Re: midnight taxes||Date: 2/17/1998 5:47 PM|
|Author: TMFPixy||Number: 1828 of 75835|
You quoted a prior message and asked:
>>>You are each allowed to contribute up to
$2K to an IRA, and I believe starting this year (effective 1/1/98), if a
spouse doesn't work outside the home, but the couple still has over $4K in
income (and any couple that doesn't certainly isn't likely to be making IRA
contributions anyway), you can contribute $2K to a spousal IRA that is
completely tax deductible, even if you can't make any DEDUCTIBLE
contributions yourself, so you could have 0 & 480 or even 0 & 2K.<<<
Is this true? If so, I would be extremely happy person. I have been wondering for some time why married couples without dual incomes have been penalized by the IRA rules. Just because a spouse doesn't currently have an income doesn't mean that same spouse doesn't need money to retire on...
Pixy, can you please verify this idea for me? I continue to be amazed at the amazing things I have learned just lurking on this board. >>
Effective 1/1/98 an unemployed spouse may indeed make up to a $2K per year deductible contribution to an IRA is the working spouse has the income to support it. Additionally, a working spouse who is not an active participant in an employer's qualified retirement plan may also make a deductible $2K contribution to an IRA even if the other spouse is covered by such a plan.
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