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Get your taxes done using TurboTax
You are correct to be concerned. You son doesn't appear to be in the business of selling popcorn. This looks like a fundraising event and he received an award/prize for raising X amount of donations. This is not earned income and therefore a Roth contribution is not appropriate. A 6% excise tax for excess contributions will apply for each year the contribution remains in the account. You should withdraw the money prior to 17 May and find another suitable savings device.
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‎April 13, 2021
12:16 PM