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Author: Seperation Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121061  
Subject: Earned Income Date: 12/8/1998 9:55 AM
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What is the definition of earned income? What is the definition of adjusted gross income? My income for 1998 consists of short term disability from my employer, long term disability from my employer, social security disability, and investement income. Can I contribute to a 1998 Roth IRA? Can I convert my prior IRAs to Roths?
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Author: TMFTaxes Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 6896 of 121061
Subject: Re: Earned Income Date: 12/8/1998 11:04 AM
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[[What is the definition of earned income? What is the definition of adjusted gross income?]]

These questions can get pretty complicated. But, generally, earned income comes from work that you preform. This income is generally reported to you via Form W-2 or by filing Sch C. In some cases, you can receive earned income from a partnership.

As far as AGI...that has different definitions for different purposes. For Roth IRA purposes, your AGI is your normal AGI, without regard for any increase in AGI caused by a Roth IRA contribution.

[[ My
income for 1998 consists of short term disability from my employer, long term disability from my
employer, social security disability, and investement income.]]

None of which, generally, meets the definition of "earned" income.

[[ Can I contribute to a 1998 Roth IRA?]]

Since you have no earned income, you would not be able to make a Roth IRA contribution.

[[ Can I convert my prior IRAs to Roths?]]

Earned income is NOT an issue with respect to Roth IRA conversions. The controlling number is your AGI.

I provide some additional information on this and other Roth IRA issues in the Taxes FAQ area (archives section). You might want to check it out for some additional information.

TMF Taxes
Roy

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