IRA & HSA Contribution Question

[Packman]

In 2022, my DW is planning to quit her job. We are looking at the most opportune time - tax wise. If she were to earn $8,000 in gross income, and contribute the max to an HSA ($4,650 for single HDHP coverage) via payroll deduction, could I still make a maximum spousal Roth IRA contribution of $7,000? In other words, are the two contribution types considered separate or combined for earned income purposes?

DW will go on COBRA health coverage for the remainder of 2022 so she will be eligible for an entire year of HSA contributions.

Could not find anything with a quick google search without digging deep into IRS publications.

 

[Packman]

OP here. After looking at some IRS pubs, I think I found that there are no requirements for income to contribute to an HSA, like that for an IRA. If true, my question is moot. Sorry for the confusion.

 

[njhowie]

Roth IRA and HSA contributions are separate and not related or have any co-dependencies.

However, if she earns $8,000 your combined Roth contributions cannot exceed $8,000. So if you contribute $7,000 to yours, she can't contribute more than $1,000 to hers. Roth contributions cannot be more than the taxable income.

 

[SevenUp]

If she were to earn $8,000 in gross income, and contribute the max to an HSA ($4,650 for single HDHP coverage) via payroll deduction, could I still make a maximum spousal Roth IRA contribution of $7,000?

No.

That is, not if the above would be the only "earned income" (aka "compensation"). Her W-2 box 1 would be $3,350 and that would be the limit for her and your combined IRA contributions.