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mkgmny
Level 1

How much can we contribute to traditional IRAs, SEPS and Simple IRA? My husband and I have 2 business with separate LLCs.

We want to contribute the maximum amount possible. We want to take 7K each in traditional IRAs, TurboTax figured the max amount for the SEPs, and use a SIMPLE IRA for the higher earner for the rest. I am unsure what the rules are for taking multiple IRA deductions. I had some income in royalties. I do not know if I need to remove that as income (I am wondering if it is considered passive income and doesn't count for an IRA). One of us made more money than the other and plan to use the spousal IRA option.
2 Replies
ErnieS0
Expert Alumni

How much can we contribute to traditional IRAs, SEPS and Simple IRA? My husband and I have 2 business with separate LLCs.

Royalty income is not earned income so it doesn't count for income that can be used for an IRA.

 

For more details see Are Royalties Earned Income for Roth IRA Contributions?

mkgmny
Level 1

How much can we contribute to traditional IRAs, SEPS and Simple IRA? My husband and I have 2 business with separate LLCs.

Thank you for the royalty information. From that information, and other I have found, we need to reduce our income by the royalty income and also by 1/2 of self employment taxes.
(Edited to delete info regarding my other questions which had not been answered as I called an accountant and now know what I need to do.)

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