There is no limit on the integer of traditional individual retirement accounts, or IRAs, that you can establish or advance to. However, you must have eligible compensation, which basically files wages, salary, or self-employment income for any year you contribute. That run offs out income from things like pensions, annuities, interest, dividends and rentals.
In supplement, you can’t have reached age 70½ by the end of the year in which you establish (or pay into) a established IRA. However, you can establish a Roth IRA at any age, as long as you have eligible compensation and tournament the income requirements. This page is a great resource for Roth IRA eligibility sine qua na.
IRA Contribution Limits
Keep in mind that regardless of the number of IRAs you contend, you still cannot contribute in total more than the annual contribution limits. These are:
- $5,500 if you are secondary to age 50
- $6,500 if you are age 50 or over (the additional $1,000 is known as a catch-up contribution)
You are conceded to contribute up to 100% of your compensation up to $5,500 (or $6,500 if you are 50 or closed). And all regular IRA contributions must be made in cash (which includes verifies), not in securities. You can divide up the permitted contribution among your IRAs or promote the whole amount to one IRA.
Spousal Contributions
If your spouse has little or no gains, you are allowed to make contributions on his or her behalf – commonly known as spousal IRA contributions. The that having been said rules apply as for traditional IRA contributions. Your spouse will partake of her or his own IRA account, since IRA accounts are not allowed to be held jointly. This brooks a family to double the amount of money set aside for retirement. (Note that should you separate, the spousal account belongs to the spouse whose name is on it, not the spouse whose earnings fix up with provisioned the contributions.)
Here are the requirements for opening a spousal account:
- You must be coupled and file a joint tax return
- You must have eligible compensation to occasion contributions
- The total contribution for both you and your spouse cannot be sundry than your taxable compensation reported on your joint tax payment
The Bottom Line
If you decide to establish multiple IRAs, remember that annual care fees may apply to each IRA. These fees average from $50 to $100 per year. Tolls can eat into your returns, so it is important to be knowledgeable about all of your retirement account fares.