Q. I am age 75 and receiving mandatory IRA distributions. Can I use this cash to fund a Roth IRA? M.T., Yardley, Pa.
A. Not exactly. As with traditional IRAs, you can contribute to a Roth IRA only to the extent you have “earned income” during the year. For instance, you must have received wages or some similar type of compensation such as self-employment income.
But there’s no requirement for using the actual dollars earned, so you can use cash from a required minimum distribution (RMD) for this purpose if you otherwise qualify.
Conversely, if your only source of income is “unearned” (e.g., investment income and RMDs), you can’t contribute any amount to a Roth.
Tip: There’s no age limit for Roth IRA contributions.
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