IRA Center This is the internet’s source for information on Retirement Accounts
for beginners and professionals. The following information covers traditional IRAs, roth IRAs, 401(k)s, 401(k)
rollovers, SIMPLE IRAs, SEP IRAs, 403(b)s, SARSEPs, Keoghs, Pension Plans. Do you participate in a retirement plan
through your employer? You may be illegible to start a Traditional or Roth IRA as well. You will be at least 18 years old but less than 70 1/2 in the year you
file, are married, and you do not work or have taxable income. If not, CLICK HERE
For any year you do not work, you cannot make IRA contributions unless you
Receive alimony or
File a joint return with a spouse who has compensation.
Spousal IRA limit. If you file a joint return and your taxable compensation is less than that of
your spouse, the most that can be contributed for the year to your IRA is the smaller of the following two amounts:
$2,000, or
The total compensation includable in the gross income of both you and your spouse for the year reduced by the
following two amounts.
Your spouse's IRA contribution for the year.
Any contributions for the year to a Roth IRA on behalf of your spouse for you.
This means that the total combined contributions that can be made for the year to your IRA and your spouse's
IRA can be as much as $4,000.
Special Note: This traditional IRA limit is reduced by any contributions to a section 501 (c)(18) plan
(generally, a pension plan created before June 25, 1959, that is funded entirely by employee contributions).
Further more, a non-working spouse's deduction limit of $2,000 is reduced if your modified adjusted gross income
(AGI) on a joint return is more than $150,000. YOU CANNOT DEDUCT ANY OF YOUR CONTRIBUTIONS IF THE MODIFIED
AGI ON YOUR JOINT RETURN IS $160,000 OR MORE.
EXAMPLE: Lisa H., a full-time student with no taxable compensation, marries Dave during the year. For the year,
Dave has taxable compensation of $30,000. He plans to contribute (and deduct) $2,000 to a traditional IRA.
If he and Lisa file a joint return, each can contribute $2,000 for the year to a traditional IRA. This is
because Lisa, who has no compensation, can add Dave's compensation, reduced by the amount of his IRA contribution,
($30,000 - $2,000 = $28,000) to her own compensation (-0-) to figure her maximum contribution to a traditional
IRA. In her case, $2,000 is her contribution limit, because $2,000 is less than $28,000 (her compensation
for purposes of figuring her contribution limit).
DISCLAIMER None of the information provided on this webpage should
be construed as tax advice. You should be advised to consult your own tax professional regarding the tax consequences
of your IRA strategy and investment activities.
