Solved

I am 74 years old and continue to work, can I set up a simple IRA from the 1099 Misc income?

Forum|Forum|7 years ago
June 4, 2019
1 reply
0 views

I receive a W-2 from one employer and do not qualify for benefits. I take my RMD from other 401K accounts. I do earn additional income from another source and receive a 1099-Misc income document but also do not qualify for benefits. Can i set up a simple IRA to contribute my 1099-Misc income?

TurboTax Home & Biz Windows

Best answer by KrisD15

No.

A simple IRA is restricted by the age limit of 70 1/2.

"A SIMPLE IRA plan account is an IRA and follows the same investment, distribution and rollover rules as traditional IRAs. See the IRA FAQs ."

"IRA contributions after age 70½

You can’t make regular contributions to a traditional IRA in the year you reach 70½ and older. However, you can still contribute to a Roth IRA and make rollover contributions to a Roth or traditional IRA regardless of your age."

CLICK HERE for IRS information on Simple IRA

CLICK HERE for IRS contribution limit

KrisD15Answer

No.

A simple IRA is restricted by the age limit of 70 1/2.

"A SIMPLE IRA plan account is an IRA and follows the same investment, distribution and rollover rules as traditional IRAs. See the IRA FAQs ."

"IRA contributions after age 70½

You can’t make regular contributions to a traditional IRA in the year you reach 70½ and older. However, you can still contribute to a Roth IRA and make rollover contributions to a Roth or traditional IRA regardless of your age."

CLICK HERE for IRS information on Simple IRA

CLICK HERE for IRS contribution limit

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"

J

jbrookshire

I believe the answer by Turbotax Kris D is inaccurate. I believe the correct answer is that you can contribute if you are over 701/2 but you must also take RMDs. Please see the IRS site here

<a rel="nofollow" target="_blank" href="https://www.irs.gov/retirement-plans/simple-ira-plan-faqs-contributions">https://www.irs.gov/retirement-plans/simple-ira-plan-faqs-contributions</a>

Can I contribute to a SIMPLE IRA of a participant over age 70 ½?
Yes, you must. Employees who are age 70 ½ or over may make salary deferral contributions to their SIMPLE IRAs. Employers must continue to make matching or nonelective contributions to employees’ SIMPLE IRAs even after an employee reaches age 70 ½. However, an employee who is age 70 ½ must also begin to take required minimum distributions from the account.

Employees may not be excluded from participating in a SIMPLE IRA plan based solely on their age.