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Can A Non Working Spouse Contribute To A Roth IRA?
A non-working spouse is eligible to have a Roth IRA. However, the spouse cannot make any contributions to the Roth because all contributions have to be made from earned dollars, and since the spouse is not working, he or she cannot contribute. |
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However, the working spouse can contribute to the Roth IRA of the non-working spouse. This is known as Spousal Roth IRA. In order to qualify for this, a couple's annual earning should not exceed $169,000 in case both are filing tax returns jointly. However, if the head of the household is filing his or her taxes separately, then the yearly income should not exceed $116,000.
The maximum contribution that can be done under Spousal Roth IRA is $5000. This is for spouses who are less than 50 years of age. In case the non-working spouse is 50 years and older, the maximum contribution is $6,000. However, a point to be noted is that the maximum contribution could be reduced depending on what the couple's modified adjusted gross income is.
Although a non-working spouse cannot contribute to a Roth IRA, the working spouse can. This means that no matter what the situation is, the couple can still stash away money for their retirement. In addition, any contribution made to the Roth IRA is by way of after-tax money and this means that all withdrawals will be tax free.
If at any given time, the spouse starts working, the contribution will then be made by that spouse. Therefore, there is never the risk of losing all that money and this allows the couple to continuously save for their retirement.
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