A spousal IRA is an IRA account established to build retirement savings for a non-working spouse. So, if you are a stay at home mom or dad or are taking time off from work, you can continue saving for retirement. Here is what you need to know:
#1. You can contribute up to $5,000 ($6,000 if age 50 or older). You should check IRS guidelines for deductibility and phase out levels.
#2. Who contributes? Usually the working spouse but it can also come from the non-working spouse. The source of the money does not matter.
#3. Any special rules? No. A spousal IRA is treated the same as a regular IRA.
#4. You must be married to your spouse at the end of the tax year.
#5. You must file a joint federal tax return.
#6. The working spouse must have taxable income for the tax year.