Can I open/contribute to a ROTH IRA account if I am unemployed?
Thank you,
2007-02-19 12:39:03 · 7 answers · asked by Sakura 1 in Business & Finance ➔ Personal Finance
By law, you do have to earn income to contribute or open a Roth IRA or any IRA (unless you are retired) because you can only contribute the LESSER of 1) Your annual income or 2) The allowable IRS contribution limit (which is currently $4000 for ages 49 and under, $5000 for ages 50 and over). Your income must come from an employment such as job or a commision base job, so if you earn no income this year, you can't open or contribute anything.
When I do a Roth IRA for someone, the form says I must put in an employment address of the client. Then it ask me if the client is retired or not. Then there's all these other questions to find the suitable investment for the client's objective.
If you are unemployed, then get a local job such as retail or supermarket until you find a career.
2007-02-21 07:26:56 · answer #1 · answered by Anonymous · 4⤊ 1⤋
You can still make a Roth IRA contribution for 2006 if you earned at least $4,000 in 2006. You just have to make the contribution by the tax filing deadline in April. This is even though you are currently unemployed. However, if you want to make a Roth IRA contribution in 2007 you need to make at least $4,000 in 2007. If you are married your spouse can also make a contribution on your behalf.
2007-02-19 13:52:12 · answer #2 · answered by Contrarian 3 · 0⤊ 0⤋
Actually, if you are talking about a ROTH IRA as you stated in your question, it makes no difference if you have any income or not. Roth IRA's are contributions of after tax dollars. Now a regular IRA has to be from income, so it is limited to your income that year it is added to or established. You get to deduct the amount you deposit. In a Roth IRA, there is not a CURRENT income deduction; just the growth is tax free. Take a look at irs.gov to see the differences, or take a look at bankrate.com to study the differences. Nobody who answered considered the specific types of IRA's.
2007-02-19 13:47:20 · answer #3 · answered by MJ 4 · 0⤊ 1⤋
No. You must have income to open or contribute to a Roth IRA. Furthermore, you may not contribute more than your income in any one year. It is your responsibility to make sure that your contributions are qualified. Your IRA administrator is not responsible for making sure you qualify.
You can still invest in a CD or money market account to set funds aside until you have a job, then you can contribute.
2007-02-19 13:17:58 · answer #4 · answered by khill 2 · 1⤊ 0⤋
You can open a SEP account, and it's tax deductible. This SEP allows you to put up to 20% of your income in the account each year!
2007-02-19 13:47:11 · answer #5 · answered by nichhew 2 · 0⤊ 0⤋
You need income.
2007-02-19 13:42:48 · answer #6 · answered by zander1331 3 · 0⤊ 0⤋
absolutely; one thing has nothing to do with the other
2007-02-19 12:50:24 · answer #7 · answered by mark w 2 · 0⤊ 1⤋