Information about Spousal IRA Accounts
September 5, 2011 By The Mendel Law Firm, L.P.
A Spousal IRA is a type of retirement account that is available to someone that is married to a working spouse, but does not work themselves. This type of account is just as important as a regular IRA account due to the fact that it offers tax deferrals.
Those that don’t work do not have the same retirement options available, such as an employer sponsored 401k. The Spousal IRA can bridge this gap.
Spousal IRA Rules
• The Spouse with the IRA account must not have any earned income and the working spouse must earn enough to cover that contribution.
• The contribution limits of a spousal retirement plan in 2010 are $5,000 annually if you are under the age of 50; those over 50 years old can contribute up to $6,000 a year.
• When money is put into a Spousal IRA account, that money will belong to the spouse that is not working, even if the working spouse is the one that made the contribution.
There are no other retirement planning programs available to non working spouses that allow tax deferred contributions, which makes it a valuable aspect of retirement when only one spouse works. Another source of income for a non-working spouse is Social Security; though they will have no benefits themselves, they can collect a percentage of their spouse’s Social Security benefits after they reach the age of retirement.
ABOUT THE AUTHOR: Steve Mendel
Mendel Law Firm, L.P. offers estate planning and business planning resources to residents of Houston TX.
Copyright The Mendel Law Firm, L.P.
More information about The Mendel Law Firm, L.P.
Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.
Spousal IRA Rules
• The Spouse with the IRA account must not have any earned income and the working spouse must earn enough to cover that contribution.
• The contribution limits of a spousal retirement plan in 2010 are $5,000 annually if you are under the age of 50; those over 50 years old can contribute up to $6,000 a year.
• When money is put into a Spousal IRA account, that money will belong to the spouse that is not working, even if the working spouse is the one that made the contribution.
There are no other retirement planning programs available to non working spouses that allow tax deferred contributions, which makes it a valuable aspect of retirement when only one spouse works. Another source of income for a non-working spouse is Social Security; though they will have no benefits themselves, they can collect a percentage of their spouse’s Social Security benefits after they reach the age of retirement.
ABOUT THE AUTHOR: Steve Mendel
Mendel Law Firm, L.P. offers estate planning and business planning resources to residents of Houston TX.
Copyright The Mendel Law Firm, L.P.
More information about The Mendel Law Firm, L.P.
View all articles published by The Mendel Law Firm, L.P.
Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.
