Re: How does a spousal IRA get set up? Help!!!

From: Jeff Salisbury <jeff.salisbury@xmission.com>
Subject: Re: How does a spousal IRA get set up? Help!!!
Date: Tue, 25 Jan 2000 16:59:20 -0700

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juanb@vnet.ibm.com wrote:
> 
> My father retired last year, receives SS and is under 70 1/2.  My
> mother still works and has enough earnings to cover the $4000 max
> for IRA contributions for them both.  They already have existing IRA's
> which they've contributed to in the past.
> 
> I spoke to both Vanguard and T. Rowe Price and they said he could
> add to his existing IRA, since he was under 70 1/2 and the
> earnings on their joint return was greater than the IRA max. So, they
> made a contribution to it, but now I'm wondering if that's correct
> or if there was a separate process for a spouse to add to it?
> 
> ANY help would be greatly appreciated.  Also, if they made a mistake,
> is there any penalty and what would have to be done to "undo" it???
> 
> Thanks in advance,
> Juan
> 
> -

Juan,

There's no mistake.  As long as their tax return shows at least $4000 of
earned income, they will each be able to list a $2000 contribution to
their respective IRAs on the same tax return.  That's all the
documentation you need -- there is no seperate process.

Regards,

Jeff

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