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Why is Turbotax saying that my Roth IRA contribution is exceeding my earned income?

I contributed the Roth IRA less than the maximum yearly contribution and significantly less than my personal income. However, Turbotax says that I am exceeding my contribution limit since it thinks that my earned income is $0. I am reporting my income under Misc. income (1099-A, 1099-C) because it is a graduate stipend received through a fellowship, so I do not have a W2 for it. Why does Turbotax think that my earned income is $0, and should I be reporting my income another way?

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2 Replies

Why is Turbotax saying that my Roth IRA contribution is exceeding my earned income?

Your stipend should be  showing on 1040 Line 1 with annotation "SCH".

Your stipend is not considered earned income; you don't pay SE taxes on it.

Without earned income, you can't make a Roth contribution.

dmertz
Level 15

Why is Turbotax saying that my Roth IRA contribution is exceeding my earned income?

The change to the tax code made by the SECURE Act to allow your stipend to be treated as compensation for the purpose of making an IRA contribution applies to tax years beginning after December 31, 2019.  It is not compensation that will support an IRA contribution for 2019.

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