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Author: svmandolin Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75632  
Subject: Roth IRA contribution questions Date: 11/4/1999 2:14 PM
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I have a question on Roth IRA's:

I would like to contribute to my Roth IRA in January of next year, but won't be working until October of next year. Is this OK to do if I have the money, or do I need to earn the money before contributing?

Also on this note, I would like to convert a traditional IRA to a Roth IRA. I have the money to pay the taxes, but does that money need to be earned income?

Thanks,

svmandolin
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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: 15112 of 75632
Subject: Re: Roth IRA contribution questions Date: 11/4/1999 4:27 PM
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Svmandolin asks:

<<I would like to contribute to my Roth IRA in January of next year, but won't be working until October of next year. Is this OK to do if I have the money, or do I need to earn the money before contributing?>>

All that counts is that you have the necessary earned income for the year in which you earn the contribution. Thus, you may contribute $2K in January even if you don't earn that $2K until December. Just make sure, though, you earn enough at some point in the year to cover that contribution. :-)

Regards..Pixy



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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: 15113 of 75632
Subject: Re: Roth IRA contribution questions Date: 11/4/1999 4:29 PM
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Svmandolin asks:

<<I would like to contribute to my Roth IRA in January of next year, but won't be working until October of next year. Is this OK to do if I have the money, or do I need to earn the money before contributing?>>

All that counts is that you have the necessary earned income for the year in which you earn the contribution. Thus, you may contribute $2K in January even if you don't earn that $2K until December. Just make sure, though, you earn enough at some point in the year to cover that contribution. :-)

<<Also on this note, I would like to convert a traditional IRA to a Roth IRA. I have the money to pay the taxes, but does that money need to be earned income?>>

No, you don't have to have earned income to convert an existing traditional IRA to a Roth IRA. All that's required to do that is to have a modified Adjusted Gross Income that does not exceed $100K in the year exclusive of the amount to be converted.

Regards..Pixy



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