The Tax Questions Blog

Question: ROTH IRA Question!?!?!?

I just set up a ROTH IRA Account, and now I need to know how much to invest. I am 18 years old, and I made about 600 dollars at a summer job. I work another job, but its under the table, so I only have 600 dollars taxable income. How much can I put into the ROTH IRA account?

Answer: you can't put more than $600 into the account, then.

if you have an extra $600 just kicking around, i'd recommend fully funding the account for the 2008 tax year (assuming the summer job was summer 2008, and not just expected for the summer 2009 - you can still make contributions against the 2008 tax year until tax day).

but you're basically in a 0% tax bracket. why not try working legitimately and taking advantage of the standard deduction, and max out the Roth this year?

Money tip: Before filing away tax return, use it as a financial guide

So you completed your federal income-tax return and filed it. Now you can relax until next year, right? Not so fast. Don't be too quick to put away that tax return. You can use it as a guide to see whether your financial position is where you want it to be or whether you need to make some changes.

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