Do dividend and rental income count towards eligible earned income for Roth IRA contribution limits?

[DanO · Accepted solution]

Dividends are not earned income. The rental income is unearned unless it is earned income from self-employment, this would be someone who is in the business of renting property, otherwise, it is passive income.

[smnorth]

Thank you! Just so that I'm clear, that means that my dividends and rental income DO NOT count towards the $135,000 IRA income limits correct?

[DanO]

No, the contribution limit is based on Modified Adjusted Gross Income which INCLUDES dividends and rental property income.