Can we contribute to Roth IRA using other accounts?

[Zigner]

I'm sorry for believing that one who has "several thousand dollars" squirreled away for "several years" should use those funds to pay for debts that have been adjudicated.

 

[Taxing Matters]

I'm sorry for believing that one who has "several thousand dollars" squirreled away for "several years" should use those funds to pay for debts that have been adjudicated.

No need to apologize for your beliefs. Nor will I apologize for mine. I certainly believe debtors should pay their just debts, but they do not have to rob the money of a non debtor (i.e. the spouse here) to do it. Money from TBE accounts and from the spouse's own separate accounts are NOT assets of the debtor (the husband) and the creditor has no right to expect the wife to pay for her husband's obligations.

 

[jessica779]

Thank you all very much! Never mind Zigner.


Let me make it very clear: the money in those two accounts (the tenants by entirety joint account, and the money in my single account) is the result of the following (a). some gifts given by our relatives or friends to me alone (not to my husband), (b) very small amount of interest (paid by the bank) for the money in those accounts, (c). rent (around 100 dollars per month) we receive from another mobile home (which is also jointly, tenants by entirety , on my name and my husband’s name) that is next to the mobile home we are now living (that other mobile home was gifted to both of us by my father long before this lawsuit was filed). That is, none of the money in those two accounts is earned income( not the income from a job or business, etc.) . Is it still OK to use the money in those two accounts to fund the roth IRA accounts on my name and my husband’s name?

 

[Zigner]

Money from TBE accounts ...

... is jointly owned.

Not arguing the law (I understand the definition), just the lack of logic in this type of situation.

 

[davew9128]

You, however, cannot have your own Roth IRA (or any IRA) because you don't earn any income from employment.

Please google spousal IRA. This is not true.

 

[Taxing Matters]

... is jointly owned.

Is the asset of the marital unit and not the asset of either spouse. As you say you understand this, then you understand that using TBE money to pay the debts of just one spouse is using money that does NOT belong to the debtor-spouse.

Not arguing the law (I understand the definition), just the lack of logic in this type of situation.

I disagree with your take that there is a "lack of logic" in my position. Only the husband is the debtor. So why should ANY of the wife's assets be used to pay that debt, whether from the TBE account (which she obviously has an interest in) or her own separate funds, be used to pay it? I don't see any logic in that proposition. Do you?

 

[Zigner]

Is the asset of the marital unit and not the asset of either spouse. As you say you understand this, then you understand that using TBE money to pay the debts of just one spouse is using money that does NOT belong to the debtor-spouse.



I disagree with your take that there is a "lack of logic" in my position. Only the husband is the debtor. So why should ANY of the wife's assets be used to pay that debt, whether from the TBE account (which she obviously has an interest in) or her own separate funds, be used to pay it? I don't see any logic in that proposition. Do you?

You misunderstood. The "lack of logic" is in the handling of the account when it's TBE and there is a creditor, like in this situation. Your logic is sound.

 

[adjusterjack]

Please google spousal IRA. This is not true.

I already corrected my earlier response.

Is it still OK to use the money in those two accounts to fund the roth IRA accounts on my name and my husband’s name?

Yes.

Not arguing the law (I understand the definition), just the lack of logic in this type of situation.

Even Medicaid and SSDI allow a certain level of income and assets and still provide benefits. Or would you prefer the "law" to strip a person of everything they have (down to the clothes on their backs) before providing aid?

 

[Zigner]

Even Medicaid and SSDI allow a certain level of income and assets and still provide benefits. Or would you prefer the "law" to strip a person of everything they have (down to the clothes on their backs) before providing aid?

Without knowing the nature of the underlying debt upon which judgment was rendered, we can't know if that is anywhere close to a valid comparison.

I understand that my viewpoint in this thread is contrary to that of others. I'll back out now.

 

[adjusterjack]

Without knowing the nature of the underlying debt upon which judgment was rendered,

We shouldn't be casting stones either.

 

[jessica779]

Thank you very much!

My husband lost the case against a restaurant in which we ate food and my husband was accused of making bad comments later about the quality of the restaurant (we could not even hire an attorney and the judge gave what the restaurant requested)

 

[LdiJ]

Your attempt to transfer the money may cause it to become available for garnishment:

https://www.floridabar.org/public/consumer/tip006/#Spousal Exemption for Jointly Hel

"Transfers of property that are fraudulent or are made solely to keep the property from creditors may cause the property to lose its exempt status."

The judge has already ruled that the creditor cannot touch the money in either of those accounts. Therefore it can be spent any way that they choose, and you know that. There is nothing illegal or even immoral about opening IRA's since the judge already said that the creditor cannot touch the money.

 

[LdiJ]

I'm sorry for believing that one who has "several thousand dollars" squirreled away for "several years" should use those funds to pay for debts that have been adjudicated.

That is your personal opinion Zig. It is wrong to give posters the impression that your personal opinion is legal advice.

 

[cbg]

I would have more sympathy for the poster if it were not for the definite impression left that there is no intention to pay the judgement, period, at any point in future.

 

[LdiJ]

I would have more sympathy for the poster if it were not for the definite impression left that there is no intention to pay the judgement, period, at any point in future.

Quite frankly, it doesn't sound like they can realistically pay the judgement. Yeah, they could take the small amount of assets that they have and put them towards the judgement, but then what are they going to do if a car breaks down, or an appliance or anything else that requires some emergency spending?

Plus, to be honest, I don't think that a restaurant deserves a financial windfall because they got a bad review from someone, and I used to own a restaurant.