MyIRA Contribution and Roth Conversion
If an individual just retired can they still contribute to the IRA as they are now unemployed and will remain so?
If so, if they convert to an Roth later I believe they are excluded from aggregation rule and it has no effect on their other Roth conversions.
Thanks
SC
Permalink Submitted by Alan - IRA critic on Wed, 2014-02-26 20:24
The individual may contribute for the year of retirement using earned income received in that year. After that, no more IRA contributions unless they qualify for a spousal contribution, which would have to be a Roth spousal contribution starting at 70.5. Conversions of TIRA account can continue under the usual Roth IRA conversion rules with or without regular contributions. The conversions would have their own 5 year holding period, stopping at age 59.5. Prior Roth conversions are not affected by later conversions and the ordering rules still apply to any Roth distributions. Note that “MyIRA” in your title looks like Obama’s new MyRA proposal, but the IRS Regs have not been written for that yet.