IRA Contributions — Divorce
A client and soon to be ex-spouse are making on-going monthly IRA contributions. The spouse does not work. Is the spouse permitted to continue making IRA contributions since the divorce will be final this year? Does it depend on when the divorce is final? Thank you.
Permalink Submitted by David Mertz on Wed, 2021-02-17 18:37
Under these circumstances, none of the non-working spouse’s IRA contributions made for 2021 would be permitted. The divorce finalized in 2021 will cause this spouse’s contributions already made for 2021 to become excess contributions. To be eligible to make a spousal contribution for a particular year, a joint tax return must be filed for that year. A divorce in 2021 would mean that the non-working spouse will not be filing a joint tax return (unless the non-working spouse remarries in 2021 and the new spouse has compensation to support the non-working spouse’s IRA contribution).
Permalink Submitted by Pattie Gradl on Wed, 2021-02-17 18:52
Thank you, DMx