Roth IRA Limits for a Non-Working Spouse

by Deborah Barlowe

In general, the Internal Revenue Service (IRS) allows only taxpayers who earn income during a tax year to contribute to Roth IRAs. If a worker has a non-working spouse, the IRS may allow her to contribute to a spousal Roth IRA on behalf of her husband depending her tax filing status and the amount of income recorded on her tax return. The IRS uses the same criteria to determine a working spouse's eligibility to contribute to a traditional IRA on behalf of her non-working husband.

Eligibility

The IRS allows a working spouse to contribute to her husband's spousal Roth IRA if they live together for at least part of the year in which she makes contributions to his account and they file a joint federal tax return as a married couple. The IRS further requires that the amount contributed to all IRAs owned by the couple be equal to or less than the amount of earned income reported on their tax return.

Contributions Limits

The IRS determines the amount a working spouse may contribute to her husband's spousal Roth IRA based on her modified adjusted gross income (MAGI) and her husband's age. As of publication, a working spouse may report a MAGI under $169,000 on her joint tax return and contribute the maximum amounts to both her Roth IRA and her husband's spousal Roth IRA. The maximum the IRS allows a working spouse whose husband is under 50 to contribute to his spousal Roth IRA equals the lesser of her taxable compensation or $5,000. If the working spouse's husband is 50 or older, the IRS allows his wife to contribute up to $6,000. The amount a working spouse may contribute to both her Roth IRA and her husband's spousal Roth IRA equals the lessor of her taxable pay or $10,000 to $12,000, depending on her age and the age of her husband.

MAGI Limits

The IRS reduces or eliminates a working spouse's ability to contribute to her husband's spousal Roth IRA if her MAGI is above certain limits. If a working spouse's MAGI is between $169,000 and $179,000, the IRS reduces the amounts she can contribute to either her Roth IRA or her husband's. The IRS does not allow a working spouse who records a MAGI equal to or greater than $179,000 to contribute to a Roth IRA belonging to her or her husband.

Calculating MAGI

A working spouse calculates her MAGI by adding certain monetary amounts to the adjusted gross income reported on her joint tax return, including deductions for contributions to a traditional IRA and student loan interest. When calculating her MAGI to determine her eligibility to contribute to a Roth IRA, the IRS requires the working spouse to exclude income related to the conversion of a traditional IRA to a Roth IRA from her calculation, however.

Holding Period

In order for the IRS to view withdrawals from a Roth IRA or spousal Roth IRA as tax-free, the account must be at least five years old at the time of the first withdrawal from the account. In addition, an account owner must be at least 59 1/2 when she makes her initial withdrawal.

About the Author

Deborah Barlowe began writing professionally in 2010. With experience in earning securities and insurance licenses and having owned a successful business, her articles have focused predominantly on finance and entrepreneurship. Barlowe holds a bachelor’s degree in hotel administration from Cornell University.

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