The Motley Fool Discussion Boards	Previous Page
Financial Planning / Tax Strategies
URL: http://boards.fool.com/wait-im-confused-which-spouse-are-we-10463059.aspx
Subject: Re: Traditional IRA Deductibility	Date: 12/14/1998 1:04 PM
Author: TMFTaxes	Number: 7126 of 121114
[[Wait, I'm confused! Which 'spouse' are we talking about in that last sentence refering to a Roth IRA? Is it the non-working one or the breadwinner who "has to have income to contribute after tax money to a Roth"?]] Perhaps I misread the question, Chris. Or didn't provide the best answer that I could. Let me try again. [[ My understanding is that a non-working spouse (AGI=0) can contribute a fully deductible $2K to a Trad. IRA or a non-deductible $2K to a Roth (or a mix) as long as the breadwinner makes enough to cover both spouses' contributions.]] That's basically correct...BUT...the definition of a "non-working" spouse has been expanded to any spouse that has less than $2k of earned income. This means that even if a spouse has some earnings, a full $2k IRA can be made for that non-working spouse...as long as the "working" spouse has enough earned income to cover the total contribution. [[ I also thought the previous (pre-1997 tax year) rules said that non-working spouses were limited to $250, not $2K.]] Again, these were the OLD rules. They went out a while ago when the Congress saw how stupid they really were. Now a "non-working" spouse (or...even "limited" working spouse) can make a full $2k contribution as long as the "working" spouse has enough earned income to cover. Hope this clears it up. If not, please try me again. TMF Taxes Roy
Copyright 1996-2014 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us