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I'm new to investing, and I'm setting up a Roth. I'm putting in 2,000 dollars for 1998 and would like to put in an additional 1,000 for 1999 at the same time. I havn't made the $1,000 in income this year yet, but I will by the end of the year. My question is can I just write my broker a check for $3,000 or do I have to give only 2,000 and wait for my YTD income to reach 1,000.

Thanks in advance,
Cameron
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My question is can I just write my broker a check
for $3,000 or do I have to give only 2,000 and wait for my YTD income to reach 1,000.


It's probably a little safer/less confusing if you give him a $2K check for 1998 & a separate $1K check for 1999, annotating on both checks which tax year the contribution is for. There's no need to have already made the $1K in 1999 (the 1998 contribution is another story: you need $2k of earned income last year to make a maximum contribution), just ensure that you earn enough to cover your 1999 contribution by 31DEC99.

Chris
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Greetings, Cameron, and welcome. You asked:

<<I'm new to investing, and I'm setting up a Roth. I'm putting in 2,000 dollars for 1998 and would like to put in an additional 1,000 for 1999 at the same time. I havn't made the $1,000 in income this year yet, but I will by the end of the year. My question is can I just write my broker a check for $3,000 or do I have to give only 2,000 and wait for my YTD income to reach 1,000.>>

As Chris aka SnootFool said, it's probably better to write two checks. In the memo field of each, write "1998 Roth IRA Contribution" on one and "1999 Roth IRA Contribution" on the other. That way there's less chance for confusion and error on the part of the IRA custodian that could cause you a tax hassle later. You don't have to wait until you earn the income to make the deposit for 1999, but do insure you earn at least that much. If you don't, you will have made an excess contribution that has to be withdrawn by 4/15/00 to avoid a penalty.

Regards….Pixy
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