Spousal IRA

AAA

DEFINITION of 'Spousal IRA'

A type of individual retirement account that allows a working spouse to contribute to a nonworking spouse's retirement savings. A spousal IRA creates an exception to the provision that an individual must have earned income to contribute to an IRA. The working spouse's income, however, must equal or exceed the total IRA contributions made on behalf of both spouses.

INVESTOPEDIA EXPLAINS 'Spousal IRA'

To qualify to make spousal IRA contributions, the couple also must file a joint tax return. Spousal IRAs can be either traditional or Roth IRAs, and are subject to the same annual contribution limits, income limits and catch-up contribution provisions as traditional and Roth IRAs. While IRAs cannot be held jointly in both spouse's names, spouses can share their account distributions in retirement.

RELATED TERMS
  1. Roth IRA

    An individual retirement plan that bears many similarities to ...
  2. Required Minimum Distribution - ...

    The amount that Traditional, SEP and SIMPLE IRA owners and qualified ...
  3. Triggering Event

    1. A tangible or intangible barrier or occurrence that, once ...
  4. IRA Adoption Agreement And Plan ...

    A contract between the owner of an individual retirement account ...
  5. Marital Property

    A U.S. state-level legal distinction of a married individual's ...
  6. Community Property

    A U.S. state-level legal distinction of a married individual's ...
RELATED FAQS
  1. What are the contribution limits for a Spousal IRA?

    The contribution limits for spousal IRAs change over time; for 2014, the limit for all IRAs was the lesser of $5,500 (or ... Read Full Answer >>
  2. How do I roll over a spousal IRA?

    “Rollover,” in regard to finances, generally means “transfer.” To roll over a spousal IRA, the assumption is that the spouse ... Read Full Answer >>
  3. My spouse has little/no income. Can I contribute to my spouse's IRA?

    Yes. You may make a Traditional IRA contribution to your spouse's Traditional IRA because you have eligible compensation. There ... Read Full Answer >>
  4. What option strategies can I use to earn additional income when investing in the ...

    A risk-averse investor should build his retirement portfolio by putting together a well-diversified portfolio and then regularly ... Read Full Answer >>
  5. What is fiduciary liability insurance, and what are its benefits?

    Under the Employee Retirement Income Security Act (ERISA), any individual who manages a employee benefit or pension plan ... Read Full Answer >>
  6. Should I purchase a master limited partnership (MLP) in my retirement account?

    Most investors should not purchase units in a master limited partnership, or MLP, in their retirement accounts. MLPs offer ... Read Full Answer >>
Related Articles
  1. Savings

    6 Retirement Savings Tips For 45- To 54-Year-Olds

    Now is the time to kick savings into high gear. Find out how.
  2. Budgeting

    Spousal IRAs For The Non-Breadwinner

    Just because you don't bring home the bacon doesn't mean you can't save for retirement.
  3. Taxes

    The Tax Benefits Of Having A Spouse

    Check out the perks designed to promote and preserve your post-work savings - if you're married, that is.
  4. Options & Futures

    Teaching Your Partner About Household Finances

    This is just one more way to take care of one of the most important people in your life.
  5. Retirement

    Making Spousal IRA Contributions

    Eligibility requirements, contribution limits and tax deductions all change with one little ring.
  6. Professionals

    Help Parents Avoid This Retirement Savings Blunder

    Parents should make saving for their own retirement a priority over helping with their children’s college costs.
  7. Investing

    Financial Gifts For Grads: Kindergarten To College

    If you really want to help your grad preparing for the future, consider a present that supports their long-term goals—an early start to financial planning.
  8. Retirement

    Find The Top Retirement Cities In South Korea

    South Korea's busy, modern capital, Seoul, has traffic signs in Korean writing only and English is not widely spoken. Check retirees' visa rules closely.
  9. Professionals

    5 Signs That You Have a Lousy 401(k) Plan

    Knowing whether a 401(k) plan is good or not so good is important. This will help participants decide how much to invest and when to demand improvements.
  10. Retirement

    Are We Looking At A Retirement Age Of 70 Soon?

    Other countries have been hiking their retirement age. What would make the U.S. government go in that direction?

You May Also Like

Hot Definitions
  1. Stop-Loss Order

    An order placed with a broker to sell a security when it reaches a certain price. A stop-loss order is designed to limit ...
  2. Covered Call

    An options strategy whereby an investor holds a long position in an asset and writes (sells) call options on that same asset ...
  3. Butterfly Spread

    A neutral option strategy combining bull and bear spreads. Butterfly spreads use four option contracts with the same expiration ...
  4. Unlevered Beta

    A type of metric that compares the risk of an unlevered company to the risk of the market. The unlevered beta is the beta ...
  5. Moving Average - MA

    A widely used indicator in technical analysis that helps smooth out price action by filtering out the “noise” from random ...
  6. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
Trading Center