This topic on ROTH IRAs came up on the Society of FSP that I haven’t read anything on it before:

I just learned from a Northwest Airlines employee (now Delta) client of mine that certain active and former airline employees can contribute certain bankruptcy related payments to a Roth IRA. Based on the December 23, 2008 Worker, Retiree, and Employer Recovery Act of 2008 “current and former employees of Delta, Northwest, and other carriers who received an Eligible Payment the ability to contribute all or any portion of that amount to a Roth IRA account.” “The Act provides that you must make any contributions to the Roth IRA 180 days from the date of the enactment (December 23, 2008)”

My client received total payments of $19,998.26 in 2007 and 2008. Based on the information Delta provided him (attached and highlighed) he can make a Roth contribution of the same amount or less!

This is news to me! If you have employees that may be candidates the 180 day clock is ticking….

Has anyone read anything about it?