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|Subject: Re: Housewife and IRAs||Date: 3/4/2004 3:20 PM|
|Author: TMFPixy||Number: 39674 of 81979|
Greeting, jkburnett, and welcome. You asked:
My wife quit her paying job to take care of the kids at home a couple of years ago. I contribute to my company's 401k. Our AGI is $85,000.
Can we contribute $3000 to my wife's IRA (a roll-over IRA from her previous job)? Is it deductible? OR contribute to a ROTH IRA in her name?
In addition, can we contribute $3000 to my Roth IRA?
If you file a joint return and as long as your joint modified AGI is less than $150K, only one of you has to be working to permit a fully deductible contribution to the unemployed spouse's traditional IRA. Based on your stated income and provided she is under age 70.5, then that means you may contribute up to $3K to your spouse's rollover IRA and fully deduct that contribution. You may also contribute up to $3K to your own Roth IRA. For details, see pages 14 and 55 of IRS Publication 590 (Individual Retirement Arrangements) available for download at http://www.irs.gov/formspubs/lists/0,,id=97819,00.html.
Hope that helps.
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