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Thread: Contributing stripping income into a Roth IRA

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    Default Contributing stripping income into a Roth IRA

    Only 'earned income' can be put into the Roth, and from what I know, the W-2 qualifies but I never had to contribute as an independent contractor before. I don't think I will get a W-2 for stripping.
    Does anyone know how I get the proper forms and proof of income for my stripping money to qualify for the Roth?


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    Default Re: Contributing stripping income into a Roth IRA

    Self-Employed income 'counts' as earned income for Roth IRA contributions. Well, that's true as long as said self-employed 'business' income has been reported on Schedule C 'Profit or Loss from a Business' of your tax return.

    (snip)"To qualify for a Roth, you must have "earned income" in the year you want to make a contribution.

    Earned income is money paid for work you performed (or in the case of a small business, profit distributions from the business). This income includes wages, salaries, tips, bonuses, commissions, and self-employment income. Other income that counts include taxable alimony and military differential pay. Earned income does not include things like interest and dividends from investments, income from rental property, and pension payments.

    If your earned income for the year is less than the contribution limit (in 2014, $5,500 for those under 50), you can only contribute up to your earned income. In other words, if your earned income is $3,000, you can only contribute up to $3,000."(snip)

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