Roth IRA maximum contribution for working teenage child, confusion from W2 numbers

Submitted by Cary Raleigh on Fri, 2022-02-04 22:00

I wanted to help my son contribute the maximum amount to his Roth IRA account. His w2 arrived today and the total wages earned in Box 1 is $1200 whereas his actual paycheck deposit is closer to $3200. His Social Security Wages in box 3 is showing $3900.

Based on his paycheck, we have already contributed $3000 to his Roth IRA account.

Please advise if was supposed to only invest $1200 as per Box 1 from W2.

Thanks



Submitted by Alan - IRA critic on Fri, 2022-02-04 22:24

The maximim IRA contribution is the amount in Box 1 – assuming that Box 1 is correct. The usual reason for Box 1 being less than 3 are pre tax 401k or other retirement plan contributions, which a teenager rarely makes. Check out the other codes in Box 12 of the W-2 before you assume he has an excess Roth IRA contribution.

Submitted by Cary Raleigh on Fri, 2022-02-04 22:30

Thanks for taking the time to help, greatly appreciate it.Box 12 is blank. 

Submitted by Alan - IRA critic on Fri, 2022-02-04 23:21

Then, the employer should be asked to explain the amount in Box 1, since it may be incorrect and too low.

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