How a Spousal IRA Works for a Non-Working Partner

One of you is home with the kids, between jobs, or caring for a parent, and that partner's retirement savings have stopped growing. Years of zero contributions can leave a six figure gap by age 65. A spousal IRA is the simplest fix, and most couples who qualify never open one because they assume an IRA requires a paycheck.

It does require a paycheck, just not necessarily yours. Here is how the rules work, how much you can put in for 2026, and how to choose between the traditional and Roth versions.

What a spousal IRA is

A spousal IRA is not a special account type. It is an ordinary traditional or Roth IRA opened in the name of a spouse with little or no earned income, funded using the working spouse's income. The tax code normally limits IRA contributions to your own taxable compensation. The spousal rule lets a married couple count their combined compensation instead.

The account belongs entirely to the non-working spouse. Their name is on it, they choose the beneficiaries, and it stays theirs if the marriage ends or the working spouse dies. That ownership point matters more than most articles admit, and I will come back to it.

Who qualifies for a spousal IRA

The requirements are short:

• You are legally married and file a joint federal tax return.
• Your combined taxable compensation is at least as large as the total you contribute to both IRAs.
• For a Roth spousal IRA, your joint modified adjusted gross income is under the Roth limit.

Age no longer caps traditional IRA contributions, so a working spouse aged 74 can still fund a spousal IRA for a partner who is 70. Filing separately almost always disqualifies you, which is one more reason couples should think twice before switching filing status.

Spousal IRA contribution limits for 2026

For tax year 2026, each spouse can contribute up to $7,500 to IRAs, or $8,600 if they are 50 or older thanks to the $1,100 catch-up. A couple both aged 50 or over could therefore shelter $17,200 in a single year across two IRAs.

The compensation test is where people slip. If the working spouse earns $14,000 from a part time job, the couple cannot put $15,000 into IRAs, because contributions cannot exceed combined compensation. Most households earn well above that, but it matters for early retirees living on a small consulting income.

You have until the tax filing deadline to contribute for a given year. For 2026, that means April 15, 2027. Label the deposit clearly as a 2026 contribution when you make it, because brokerages default to the current year.

Traditional or Roth for the non-working spouse

The same logic that applies to any IRA applies here, with one twist: the non-working spouse has almost no income of their own, but the tax decision is made on the couple's joint return.

Traditional spousal IRA

Contributions may be deductible. If the working spouse is covered by a workplace plan such as a 401(k), the deduction for the non-working spouse's IRA phases out at roughly $242,000 to $252,000 of joint modified AGI for 2026. Below that range, the full contribution is deductible. In the 22 percent bracket, a $7,500 deduction saves $1,650 in federal tax this year.

Roth spousal IRA

No deduction now, but qualified withdrawals in retirement are tax free. The Roth contribution phases out over roughly the same joint income range for 2026. If you expect your household income to rise, or you already have most savings in pre-tax accounts, the Roth side usually makes more sense. Our comparison of Roth IRA vs traditional IRA for a first-time investor walks through the bracket math.

A practical rule I give couples: if your joint income puts you in the 12 percent bracket or lower, lean Roth. In the 24 percent bracket or higher with a big pre-tax balance already, lean traditional. In between, splitting is fine.

Why "just max the 401(k) first" is not always right

The standard advice is to put every spare dollar into the working spouse's 401(k) before touching an IRA. I think that is often the wrong order, for three reasons.

First, ownership. A 401(k) belongs to the employee. In a divorce it can be divided, but that takes a court order and legal fees. A spousal IRA is already in the other partner's name. For a spouse who has stepped out of the workforce for years, that independence is worth a lot.

Second, cost. Many 401(k) plans still carry funds with expense ratios of 0.5 to 1 percent. An IRA at a major brokerage can hold a total market index fund at 0.03 percent. On $100,000 over 25 years, that difference can cost tens of thousands of dollars.

Third, balance between partners. If all savings sit in one name, the household has fewer options later, such as spacing out withdrawals to stay in a lower bracket.

The exception is the employer match. Always contribute enough to get the full match first, since that is an instant return. Our guide to how a 401(k) employer match works shows how to find your match level. After that, a spousal IRA deserves to be next in line.

How to open and fund a spousal IRA

1. Pick a brokerage with no account minimum and low cost index funds.
2. Open the IRA in the non-working spouse's name, using their Social Security number.
3. Name a beneficiary, usually the other spouse, with children as contingent.
4. Set up an automatic monthly transfer from the joint checking account. For the full $7,500, that is $625 a month.
5. Choose a simple investment, such as one target date fund or a broad stock and bond index mix.
6. At tax time, report traditional contributions on the joint return to claim any deduction.

If you are behind on savings overall, a spousal IRA is one of the fastest ways to double what a single-income household puts away. For broader benchmarks by age, see how much to save for retirement in your 30s.

Frequently asked questions

Can a stay-at-home spouse contribute to an IRA?

Yes, through a spousal IRA, as long as the couple files a joint return and the working spouse has enough taxable compensation to cover both contributions. The account is fully owned by the stay-at-home spouse. For 2026, the limit is $7,500, or $8,600 at age 50 and over.

Is a spousal IRA tax deductible?

A traditional spousal IRA can be deductible. If the working spouse has a workplace retirement plan, the deduction phases out at higher joint incomes, roughly $242,000 to $252,000 for 2026. A Roth spousal IRA is never deductible, but qualified withdrawals are tax free.

What happens to a spousal IRA in a divorce?

The IRA stays in the name of the spouse who owns it, but it is still marital property and can be split as part of the settlement. A transfer incident to divorce lets assets move between IRAs without tax or penalty. Get the transfer written into the divorce decree.