Hi!
Since I discovered MMM and this forum a few months back, i finally set up a Roth IRA for myself, and have fully funded it already! But i'm wondering if we should/can set up a similar IRA for my wife?
Here's our situation- my gross income is $85,000 a year and my wife is currently staying at home with the kids, so she doesn't have an income stream right now (and probably won't in the foreseeable future) We have no debt or mortgage and i'm funding the following accounts:
-Maxing out a SIMPLE IRA (i work for a small business, so no 401K)
-Maxing out my Roth IRA
-Maxing out a HSA
-Rest is going into a taxable account
Given this situation, i guess my questions are
1) Are we allowed to set up an IRA for my wife even though she's not working (i've read conflicting info on this)
2) If we are allowed to set one up, does it make sense to do so? My thought here is that maybe we set up a traditional IRA for her? My understanding is that, you can take a full tax deduction on a traditional IRA even if you're participating in an employer plan as long as you're married/filling jointly, and your MAGI is less than $92,000
http://www.irs.gov/publications/p590/ch01.html#en_US_2012_publink1000230467 Maybe i'm just over-complicating things? Any thoughts, would be appreciated.
Thanks!