Roth IRA contribution with "no earned income"

[Gettingrich]

Ok, so all of my income came from sports betting this year. I entered all my wins and losses under "Gambling Winnings" in Turbo Tax. Then, I started fooling around with the Roth IRA deductions and credit part, because I was planning on contributing the max for the 2012 year here in a couple weeks. After I input all the info, it comes out saying: "Your Roth Contribution Was Too High. Roth IRAs offer some great benefits, but they have restrictions on how much you can contribute. You contributed $5,000 to a Roth, but your earned income was only zero. Roth contributions can't be more than earned income, which means you have an excess contribution of $5,000."

Does this mean I'm not allowed to contribute, because I don't have any "earned income" ? Is there anyway around this, or do I have to wait until next year, when I'll be filing as self employed?

Thanks for your help.

[Viking65]

Does this mean I'm not allowed to contribute, because I don't have any "earned income" ?

- Correct

Is there anyway around this,

- Not legally, that I am aware of

or do I have to wait until next year, when I'll be filing as self employed?

- I don't know how being self-employed affects your eligibility to contribute to a Roth. Others on the forum will.

[sscritic]

I don't know how being self-employed affects your eligibility to contribute to a Roth. Others on the forum will.

Google knows.

[hq38sq43]

Ok, so all of my income came from sports betting this year. I entered all my wins and losses under "Gambling Winnings" in Turbo Tax. Then, I started fooling around with the Roth IRA deductions and credit part, because I was planning on contributing the max for the 2012 year here in a couple weeks. After I input all the info, it comes out saying: "Your Roth Contribution Was Too High. Roth IRAs offer some great benefits, but they have restrictions on how much you can contribute. You contributed $5,000 to a Roth, but your earned income was only zero. Roth contributions can't be more than earned income, which means you have an excess contribution of $5,000."

Does this mean I'm not allowed to contribute, because I don't have any "earned income" ? Is there anyway around this, or do I have to wait until next year, when I'll be filing as self employed?

Thanks for your help.

It might be well for you to consult a tax professional as to whether you should report income and claim expenses "this year" (presumably 2012) as a professional gambler on Schedule C. Net Schedule C income is "earned income" that would qualify you to invest in an IRA(regular or Roth). It is probably too late for a SEP, Keogh, or individual 401k, but you might consider those possibilities for next year. You could, of course, google "professional gambler IRS" and educate yourself. Lots of good stuff on this on Google.

Best regards,

[Bogle101]

Ok, so all of my income came from sports betting this year. I entered all my wins and losses under "Gambling Winnings" in Turbo Tax. Then, I started fooling around with the Roth IRA deductions and credit part, because I was planning on contributing the max for the 2012 year here in a couple weeks. After I input all the info, it comes out saying: "Your Roth Contribution Was Too High. Roth IRAs offer some great benefits, but they have restrictions on how much you can contribute. You contributed $5,000 to a Roth, but your earned income was only zero. Roth contributions can't be more than earned income, which means you have an excess contribution of $5,000."

Does this mean I'm not allowed to contribute, because I don't have any "earned income" ? Is there anyway around this, or do I have to wait until next year, when I'll be filing as self employed?

Thanks for your help.

That is impressive, I've seen how difficult line shopping can be. Did you do all sports or just NFL?

[Gettingrich]

Ok, so all of my income came from sports betting this year. I entered all my wins and losses under "Gambling Winnings" in Turbo Tax. Then, I started fooling around with the Roth IRA deductions and credit part, because I was planning on contributing the max for the 2012 year here in a couple weeks. After I input all the info, it comes out saying: "Your Roth Contribution Was Too High. Roth IRAs offer some great benefits, but they have restrictions on how much you can contribute. You contributed $5,000 to a Roth, but your earned income was only zero. Roth contributions can't be more than earned income, which means you have an excess contribution of $5,000."

Does this mean I'm not allowed to contribute, because I don't have any "earned income" ? Is there anyway around this, or do I have to wait until next year, when I'll be filing as self employed?

Thanks for your help.

It might be well for you to consult a tax professional as to whether you should report income and claim expenses "this year" (presumably 2012) as a professional gambler on Schedule C. Net Schedule C income is "earned income" that would qualify you to invest in an IRA(regular or Roth). It is probably too late for a SEP, Keogh, or individual 401k, but you might consider those possibilities for next year. You could, of course, google "professional gambler IRS" and educate yourself. Lots of good stuff on this on Google.

Best regards,

Thanks. Ya, I've already educated myself on all this. I could definitely file as pro this year, but not doing it for a number of reasons. It will be much easier to just do so next year.

[Gettingrich]

Ok, so all of my income came from sports betting this year. I entered all my wins and losses under "Gambling Winnings" in Turbo Tax. Then, I started fooling around with the Roth IRA deductions and credit part, because I was planning on contributing the max for the 2012 year here in a couple weeks. After I input all the info, it comes out saying: "Your Roth Contribution Was Too High. Roth IRAs offer some great benefits, but they have restrictions on how much you can contribute. You contributed $5,000 to a Roth, but your earned income was only zero. Roth contributions can't be more than earned income, which means you have an excess contribution of $5,000."

Does this mean I'm not allowed to contribute, because I don't have any "earned income" ? Is there anyway around this, or do I have to wait until next year, when I'll be filing as self employed?

Thanks for your help.

That is impressive, I've seen how difficult line shopping can be. Did you do all sports or just NFL?

Nope, don't bet the NFL at all, or any other major professional sports. NFL is the toughest sports market to beat in the world. I'm an expert in College Football, College Basketball, and WNBA. There are many more teams to handicap and the linesmakers/market is not nearly as sharp.

[retiredjg]

Any possibility you have a spouse with earned income?

[Gettingrich]

Any possibility you have a spouse with earned income?

Nope, I'm single.