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Author: TMFPixy Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 78701  
Subject: Re: IRA questions (I'm a newbie) Date: 8/1/1999 8:04 AM
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Greetings, LanyiB, and welcome. You wrote:

<<My wife and I are jointly filing and our AGI is over $58,000. I am enrolled in my employer's 401K plan and contribute the maximum amount possible. I plan on establishing a Roth IRA for myself but I don't know which option would be better for my wife. Can I contribute to a Spousal IRA in her name even though she has income? Or if she starts contributing to a deductible IRA and later stops working, can that amount be rolled over into a Spousal? >>

Yes, you may contribute to your spouse's IRA based on your joint income. If that contribution is to a traditional IRA and if she is not participating in a retirement plan through her own employment, then that contribution is fully deductible while your joint AGI remains at $150K or less. OTOH, if she does have a plan at work to which she or her employer contributes, then your current AGI is too high to make a deductible contribution to her IRA. In that case, a Roth IRA contribution is better.

BTW, a spousal IRA is simply a term for a traditional IRA that's established to receive contributions on the behalf of a non-employed spouse. Yours is employed, so the term doesn't apply. Even if it did, a traditional IRA is a traditional IRA, so her working or not working would make no difference.

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