Contribution to IRA from abroad?

[legilber]

Hi to all the US Citizens out there!!

Well... it appears that despite my protests, we're going to be staying here for another two years to make the move back to the States a little more cushy as far as the bank account goes. Surprisingly enough we´re actually able to save more money in inflation-ridden Argentina than in the US... Crazy!!

Having said that I am intersted in point of views regarding US citizens abroad contributing to a traditional IRA. I´m taxed here but have my money sent to my US bank account every month. So I wanted to see if this would be feasible or if I´m possibly risking some sort of IRS hassle?

Has anyone done this? Is it possible or even legal? I´m going home in December and will be talking with my account about things, but I wanted to get a head start now.

Any help would be great!

 

[citygirl]

I assume you also file taxes in the US but take the foreign income exclusion? If your entire income is excluded then no, you can't contribute as you have no income in the US.

this may help -
Can I contribute to a U.S. IRA Retirement Plan?
In order to contribute to an IRA, you must have earned income which is equal to or greater than your contribution. If you exclude your entire income in a tax year via the foreign income exclusion, and also make an IRA contribution, you have to pay an excise tax on that contribution, and the tax will be assessed again in each future tax year until the IRA contribution has been withdrawn. A way around this is to choose a 12-month period that will not give you a full exclusion of your income, and therefore leave you with enough earned income to meet the requirements to contribute to an IRA. Also, any days worked in the U.S. on your foreign assignment are not excludable, and so the income generated on those days may be enough to allow you to contribute to the IRA.

 

[elcolo]

As an Irishman, when I saw this thread I was thinking you were talking about contributing to something entirely different!

 

[legilber]

haha no no!! Sorry meaning Individual Retirement Account..

Thanks citygirl! I claim all of my income so it looks like I´m not eligible!

 

[GuilleGee]

Legilber, I wouldnt be able to tell you anything about the IRA tax free, but I was wondering if you could let me in on how you get your money sent to your US bank account, as that is something I need to start doing soon.

 

[GuilleGee]

P.S. sorry for hijacking the thread

 

[marksoc]

As an Argentinean, I understood the same as the Irishman (why someone wants to give money to the IRA?! Maybe those expats have a lot of secrets that I don´t know).