How do Spousal IRAs Work?

Personal Finance February 07, 2017 Print Friendly and PDF

Spousal IRAs are a type of individual retirement account designed for married couples where one spouse is not employed. The working spouse may contribute up to $5,500 per year (2017 figure) to an IRA, in the name of the non-working spouse, and up to $5,500 per year to his or her own IRA. As a result, a couple may contribute 100% of their income up to a total of $11,000 per year (2017 figure).

In addition, if you are age 50 or over by year-end, you may contribute an additional $1,000 (for a total of $6,500) to an IRA. This is called a catch-up contribution. If both individuals are 50 years of age or older, the total amount that can be contributed to their two IRAs (worker and spousal) is $13,000.

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