If lower, your taxable compensation for the year. You can open an IRA at any age, but you need to earn income to contribute to it. A 16-year-old with a part-time job can open an IRA and start contributing, but a 20-year-old full-time student with no income cannot make any contribution to the IRA. Keep in mind that minors can only open custodial IRAs, or they can even open a Gold IRA if they have the help of an adult to use them until they reach the minimum legal age for investing (usually 18, but it depends on state law).If you don't qualify to make a deductible contribution, you can still invest money in a traditional IRA.
See publication 590-A, Contributions to Individual Retirement Arrangements (IRAs), for more information on IRA losses. The timing of IRA contributions can determine how much they will increase over time and how much you'll need to use when you retire. A requalification allows you to treat a regular contribution made to a Roth IRA or a traditional IRA as if it had been made to another type of IRA. Instead, a contribution is new money that wasn't previously in a tax-deferred account and is now depositing in an IRA.
Your total contributions to your IRA and your spouse's IRA cannot exceed your combined taxable income or the annual IRA contribution limit multiplied by two, whichever is less. Yes, you can contribute to an IRA for your unemployed, non-working spouse who files a joint return, but your combined total contribution cannot exceed your combined taxable income or double the annual IRA limit, whichever is less. However, keep in mind that your eligibility to contribute to a Roth IRA depends on your income level. Initial tax relief is one of the main things that differentiate the rules of traditional IRAs from Roth IRAs, in which taxes are not allowed to be deducted for contributions.
To recharacterize a regular contribution to an IRA, you ask the administrator of the financial institution holding your IRA to transfer the amount of the contribution plus earnings to a different type of IRA (either a Roth or traditional one) through a transfer from trustee to trustee or to a different type of IRA with the same trustee. Do not use Form 8606, Non-Deductible IRAs (PDF/PDF, Non-Deductible IRAs) to declare non-deductible contributions to a Roth IRA. However, to be eligible, you must have taxable compensation of an amount equal to or greater than the amount of your IRA contribution.