Can we still save in a spousal IRA?


Q. I am over 70 1/2 and taking Required Minimum Distributions (RMDs) from my IRA. I still do some consulting work earning a paycheck. I know I can no longer contribute to my IRA, but can we still make spousal contributions to my wife’s IRA as she is still younger than 70 1/2?

— Husband

A. You’re correct that there’s a maximum age limit for traditional IRA contributions. Like you said, it’s 70 1/2.

You may, as you suggested, be able to use a spousal IRA contribution for a younger spouse, said Brian Power, a certified financial planner with Gateway Advisory, LLC in Westfield.

“If you are working and over age 70 1/2, but have a younger non-working spouse who is under age 70 1/2, using the spousal IRA rules, you could make an IRA contribution for them,” Power said.

Just make sure you do it right.

To make any type of IRA contribution, you must have earned income equal to or greater than the amount of the IRA contribution, Power said.

“For a spousal IRA contribution, as long as one of you has enough earned income, you can make a spousal IRA contribution for a spouse that has no earned income,” he said. “That means you can contribute to a spousal IRA for a non-working spouse.”

He said at your age, the maximum contribution into a spousal traditional IRA or Roth IRA is $7,000 for 2019 – $6,000 for the contribution and $1,000 more for a catch-up for those over age 50. Roth IRA income limits for Roth IRA for 2019 is $193,000 to $203,000.

You also have until the tax filing date to make a contribution for 2018, though that limit is $5,500, plus the extra $1,000 for those over age 50.

Happy saving!

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