Can I Have a Joint IRA Account?

With the tax season recently coming to an end, there are many people wondering about IRA contributions and in general, how retirement investing works.

Last year this time I personally opened up my first Roth IRA. This year, on April 15th, I received this question from a reader:

“Between me and my wife, can we put 10,000 (for 2009 yr – I know the deadline was today but I am just asking) in ROTH IRA? Could we open a joint IRA account at lets say Fidelity and have 10,000 deposited or do we have to have separate accounts since one person limit is only 5,000?”

No Such Thing as a Joint IRA Account

The short answer is no, you can’t have a joint IRA account. IRA actually stands for Individual Retirement Arrangement. It’s an arrangement you establish as an individual with the other parties involved being a custodian (like Fidelity, or in my case, Vanguard), as well as the federal government, via the Internal Revenue Service.

By definition, the IRA cannot be jointly owned. This was an attempt, I assume, to keep the system simple.

Therefore, to reach your contribution limits for the year for both you and your spouse, you will need to open two IRA accounts. Here’s more about contributions…

Roth and Traditional IRA Contribution Limits

For 2009 (and 2010) the contribution limits to a traditional IRA and a Roth IRA were both $5,000 ($6,000 if 50 or older). These contribution limits are imposed on the individual. So, regardless of your marital status, you’ll be limited to these amounts yourself.

Your spouse has his/her own separate limit for their IRA.

Need a good reason to start a Roth IRA? Check out 10 Reasons to Get Off Your Butt and Start a Roth IRA.

Beneficiary vs Joint Ownership

While you can’t have joint ownership to an IRA, you can designate someone, like your spouse, as the beneficiary to the account. Therefore, if something were to happen to you, the assets in the IRA would pass to the beneficiary.