Spousal IRA contributions

[Simplytex 387]

I'm just being lazy and wondering if anyone here has the answer for this:

 

For 2022, I'm going to file Married Filing Separately for ease (I know, won't get as much of a tax break, but the whole "non-resident alien filing special papers to qualify for resident status" is just... weird.) My wife hasn't yet received her visa, and hasn't been in the US/lived together with me. She also does not yet have an ITIN. 

 

Does anyone know, based on that alone whether she qualifies for contributions to a traditional IRA account? I might just call up Fidelity and see if they can advise. 

[Rocio0010 5,579]

Paging @pushbrk on this one

[pushbrk 12,963]

17 minutes ago, Rocio0010 said:

Paging @pushbrk on this one

Yeah, I'm the affidavit of support guy, not the tax guy.

[Wuozopo 4,293]

15 hours ago, Simplytex said:

I'm just being lazy and wondering if anyone here has the answer for this:

 

For 2022, I'm going to file Married Filing Separately for ease (I know, won't get as much of a tax break, but the whole "non-resident alien filing special papers to qualify for resident status" is just... weird.) My wife hasn't yet received her visa, and hasn't been in the US/lived together with me. She also does not yet have an ITIN. 

 

Does anyone know, based on that alone whether she qualifies for contributions to a traditional IRA account? I might just call up Fidelity and see if they can advise. 

 
An IRA is a perk for taxpayers—-for someone who is employed, has taxable income, and is filing a tax return. I don’t see how your wife can establish an IRA when she will have no association with the IRS nor reporting taxable income.

[nastra30 2,288]

16 hours ago, Simplytex said:

Does anyone know, based on that alone whether she qualifies for contributions to a traditional IRA account? I might just call up Fidelity and see if they can advise. 

No she does not qualify. For a non-citizen to qualify they must be legally working and living in the US. A spouse can be a homemaker and you contribute to an IRA on her behalf but she still has to be LIVING in the US.

 

Now this is my unsolicited advice:

If you are just looking for a way to increase your IRA contribution by way of another account (via spouse), then it won't be possible until she is living in the US. On the other hand, you yourself can increase the amount in your IRA(specifically Roth IRA) by way of backdoor Roth IRA through your 401K (if you have one). This is how it works: you'll contribute after tax (non-Roth) contributions to your 401K and immediately transfer that contributions to your Roth IRA. The after tax money will now grow tax free in your Roth IRA. After-tax non-roth 401k contributions does not affect your traditional/or Roth 401k contributions limit.

Edited January 26, 2023 by nastra30

[Simplytex 387]

1 hour ago, nastra30 said:

No she does not qualify. For a non-citizen to qualify they must be legally working and living in the US. A spouse can be a homemaker and you contribute to an IRA on her behalf but she still has to be LIVING in the US.

 

Now this is my unsolicited advice:

If you are just looking for a way to increase your IRA contribution by way of another account (via spouse), then it won't be possible until she is living in the US. On the other hand, you yourself can increase the amount in your IRA(specifically Roth IRA) by way of backdoor Roth IRA through your 401K (if you have one). This is how it works: you'll contribute after tax (non-Roth) contributions to your 401K and immediately transfer that contributions to your Roth IRA. The after tax money will now grow tax free in your Roth IRA. After-tax non-roth 401k contributions does not affect your traditional/or Roth 401k contributions limit.

Thanks, I was researching some more last night and I think that roughly lines up with what I found: spousal benefit is only available if MFJ, so that seems to be a non-starter for me. 

[nastra30 2,288]

2 hours ago, Simplytex said:

only available if MFJ, so that seems to be a non-starter for me. 

Correct. For you to be able to contribute to your non citizen spouse's IRA  they must be living in the US, and taxes must be filed MFJ.