IRA contribution for ex-husband | Ed Slott and Company, LLC

IRA contribution for ex-husband

Client is filing taxes as joint with husband for 2019. She already made her 7k contribution (both over 50)

they divorced in March of 2020.

a. Can she add the 7k for her ex-husband's IRA for 2019? (she wants to take care of him with a little bit of money and save on tax deductions since they are filing joint for 2019).

b. If the answer is yes, and she adds the 7k for his IRA, receives the tax deduction for 2019 and then he decides to take his money in his IRA out in 2 months, is there any ramifications on the joint taxes filed for 2019?

Thank you
Douglas.

  • Husband must have the lower earned income to receive a spousal contribution, although if he has earned income he would not need a spousal contribution. She could just gift him the funds to make his own IRA contribution. However, there are modified AGI income limits for both spouses to deduct their contributions. If MAGI is too high (depending on which spouses are active participants in a workplace plan), they might consider a Roth contribution, which has a higher income threshold. 
  • The 2019 return will only be affected if he withdraws the specific 2019 contribution (with earnings), since any deduction would then be lost. However, if he were to simply withdraw a dollar amount without identifying the 2019 contribution, the 2019 return would not be affected, but he would owe taxes for 2020. 
  • If the joint return for 2019 has already been calculated, the tax program should indicate if one or both spouses qualifies for a TIRA deduction.
 

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