ROTH IRA phaseout contribution limit
I am hoping somebody can help answer this question. We are married/filing jointly; modified AGI is approx 180K. I calculated our ROTH IRA contribution limit [using the IRS ROTH IRA Publication Worksheet 2-2. (“Determining Your Reduced Roth IRA Contribution Limit”)] to be about $1080. Earned compensation for me is about 157K and for my husband $655.
Now our CPA told us for tax year 2012 only one of us can contribute 1080. But my impression is that EACH of us should be able to contribute 1080, because of the spousal IRA contribution rules. If you know the answer (and even better can quote the appropriate section of the tax code), I’d really appreciate it. Thanks.
Permalink Submitted by Alan - IRA critic on Thu, 2013-04-11 21:26
Yes, a spousal contribution can be made for the lower earner. Separately, for a Roth contribution the worksheet applies to each spouse so you each can make the same max Roth contribution. You have enough earned income for your spouse to make a maximum contribution and that is very clear from Pub 590 coverage of spousal contributions. But the worksheets reduce that contribution to the amount you calculated for each spouse due to your joint MAGI. If you or your spouse does not have a non Roth IRA balance, either of you could make a 5,000 non deductible TIRA contribution, report it on Form 8606 and convert it to a Roth IRA tax free this year. This would increase the amount you or he could get into a Roth IRA.