The Basic Rules for Opening a Roth IRA

You can open a Roth IRA if you have earned income — money you made from working, not from investments or Social Security. There is no age limit to open one. The real restriction is on how much you can contribute each year, and that limit depends on your income level and tax filing status.

The IRS sets income thresholds that phase out your ability to contribute. If your income exceeds the phase-out range for your filing status, you cannot contribute to a Roth IRA that year, though you may still be able to use a backdoor Roth strategy (a workaround explained below). These thresholds change annually, so you need to check the current year's limits before you contribute.

Key Takeaways

  • You must have earned income from work to open a Roth IRA; investment income and Social Security do not count.
  • Income limits phase out your ability to contribute, and the limits vary by tax filing status and change each year.
  • If your income exceeds the phase-out range, you cannot contribute directly, but a backdoor Roth may be an option.
  • You can open a Roth IRA at any age, and you can contribute for a spouse with no earned income if you file jointly.
  • Contribution limits apply per person per year, not per account, so opening multiple Roths does not increase how much you can put in.

Income Limits by Filing Status

The IRS income thresholds for Roth contributions are based on your Modified Adjusted Gross Income (MAGI), which is usually your regular adjusted gross income with some add-backs. The phase-out range — the income band where your contribution limit shrinks — differs by tax filing status.

For single filers, the phase-out range is narrower than for married couples filing jointly. Married filing separately has the tightest range and the lowest starting point. If you are in the middle of a phase-out range, you can contribute a reduced amount rather than nothing. The IRS provides worksheets to calculate your reduced contribution limit, or your tax preparer can do this for you.

Because these thresholds change each year, you should check the current limits on the IRS website or ask your financial institution before you contribute. Contributing above your limit can result in a penalty tax on the excess amount.

Earned Income Requirements

Earned income means wages, salary, self-employment income, or taxable alimony. It does not include interest, dividends, capital gains, rental income, or Social Security benefits. If you are retired or living on investment income, you cannot open a Roth IRA in your own name.

If you are married and one spouse has no earned income, the working spouse can open a spousal Roth IRA for the non-working spouse. The contribution limit is based on the working spouse's income, and you must file jointly. This is one of the few ways to fund a retirement account for someone with zero earned income.

Contributing for a Spouse With No Income

A spousal Roth IRA allows the earning spouse to contribute on behalf of a non-earning spouse, up to the annual contribution limit. You must be married, file a joint tax return, and the earning spouse's income must be at least as much as the total contributions for both spouses combined.

The non-earning spouse must have their own separate Roth IRA account. You cannot contribute to your spouse's account directly; instead, your spouse opens their own account and you fund it. The contribution counts against the earning spouse's income for phase-out purposes, not the non-earning spouse's (since they have no income).

The Backdoor Roth Strategy

If your income exceeds the phase-out limit, you may still be able to fund a Roth IRA using a backdoor Roth conversion. This involves opening a traditional IRA, contributing money to it (which may be tax-deductible depending on your income and whether you have a workplace retirement plan), and then converting that traditional IRA to a Roth IRA.

The conversion itself is not subject to income limits — anyone can convert a traditional IRA to a Roth. However, the backdoor Roth is complex and has tax consequences. If you have existing traditional IRA balances, the conversion can trigger a tax bill on the pre-tax portion of those balances. You should consult a tax professional before attempting a backdoor Roth to understand whether it makes sense for your situation.

Age and Account Ownership Rules

There is no age limit to open a Roth IRA. You can open one at 18 or at 75, as long as you have earned income. A minor can open a Roth IRA if they have earned income from work — for example, a teenager with a part-time job or self-employment income.

Each person can have only one Roth IRA in terms of contribution limits — if you open multiple Roth accounts at different institutions, your total contributions across all of them cannot exceed the annual limit. The accounts are separate, but the contribution limit is per person, not per account.

Frequently Asked Questions

Can I open a Roth IRA if I am self-employed?

Yes. Self-employment income counts as earned income. You will report it on Schedule C of your tax return. Your contribution limit is based on your net self-employment income after the self-employment tax deduction, so you may need to calculate this carefully or work with a tax preparer.

What if my income is right at the phase-out limit?

If your MAGI falls within the phase-out range, you can contribute a partial amount. The IRS provides a worksheet to calculate the reduced limit based on how far into the range your income falls. Your financial institution or tax preparer can help you determine the exact amount.

Can I contribute to a Roth IRA if I have a 401(k) at work?

Having a 401(k) does not disqualify you from a Roth IRA. However, if you have a workplace retirement plan, the income phase-out range for Roth contributions may be lower than for someone without a plan. Check the current year's limits based on your filing status and whether you are covered by a workplace plan.

What happens if I contribute too much to my Roth IRA?

Excess contributions are subject to a 6 percent penalty tax each year they remain in the account. You can remove the excess and any earnings on it before your tax filing deadline to avoid the penalty. If you discover an excess after filing, you may be able to request a correction from the IRS, but it is better to verify your limit before contributing.

Can a non-citizen open a Roth IRA?

Yes, if you have earned income and a Social Security number or Individual Taxpayer Identification Number (ITIN). You must file a U.S. tax return and meet the same income limits as any other filer. Visa status does not prevent you from opening a Roth IRA.