Can I treat ESPP stock sale 'compensation income' as as 'earned income' for use for a Roth IRA contribution even if I have no other earned income? I'm currently retired.

[pandersj5805]

I am retired and have no 'earned income' but a sale of ESPP stock last year generated 'compensation income' which is taxed as 'ordinary income'. Does this income qualify as ROTH IRA contribution source?

[dmertz · Accepted solution]

See What Is Compensation? in IRS Pub 590-A:

https://www.irs.gov/publications/p590a/ch01.html#en_US_2016_publink1000230355

The IRS considers your eligible compensation to be the amount in box 1 of your W-2 minus any amount of deferred compensation in box 11.