Catherine Posted October 9, 2020 Report Posted October 9, 2020 Client put $700 into her Roth IRA for 2019. No wages. Business loss. Filing status is married filing separately because her divorce was not final until early 2020. Can she still claim that contribution as a "spousal IRA" or is she hosed? The only thing I found was that MFS uses the single limits for income phase-outs for a Roth IRA. Worse comes to worse she will recharacterize to a 2020 contribution and only have to get back any growth. Annoying; her business is cyclical and every few years she goes to a slew of shows and runs up huge travel expenses. Good thing she was planning NO travel in 2020! So that should be a profitable year for her. 1 Quote
jklcpa Posted October 9, 2020 Report Posted October 9, 2020 15 hours ago, Catherine said: Can she still claim that contribution as a "spousal IRA" or is she hosed? Pretty sure that spousal IRA can only be claimed on a joint return. 2 Quote
Catherine Posted October 10, 2020 Author Report Posted October 10, 2020 That's what I was afraid of. Thanks, Judy! 1 Quote
Hahn1040 Posted October 11, 2020 Report Posted October 11, 2020 One solution is to leave it in and pay the 6% excess contribution penalty and then apply the contribution to 2020. Of course, this only works if she has earned income in 2020, is not over the income thresh-holdings, and otherwise meets the contribution requirements. 1 Quote
Catherine Posted October 13, 2020 Author Report Posted October 13, 2020 Thanks Judy and Hahn. As it turns out, there was a listing of sales in her business that I had missed. That put her into profit and her Roth contribution is OK! Phew. 2 Quote
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