Periodically, I get search hits for the guest post on spousal IRAs for SAHMs (or other spouses who don’t bring in traditional income). Only the searchers are more interested in whether or not a gay spouse can have a spousal IRA.
The answer is no. Not even if you’re married in Massachusetts or (soon?) California. While the US government allows states to come up with their own specific marriage laws, the “Defense of Marriage Act” inserted this little bugger into federal law:
In determining the meaning of any Act of Congress, or of any ruling, regulation, or interpretation of the various administrative bureaus and agencies of the United States, the word “marriage” means only a legal union between one man and one woman as husband and wife, and the word “spouse” refers only to a person of the opposite sex who is a husband or a wife.
Preemptive strike by the Right against gay couples ever having equal rights, even if they’re married. Am I the only one who feels like this was a really mean thing to do?
What it essentially means is that while you may be married, you can only be a “spouse” for federal law and thus can only have the Spousal IRA if you’re the opposite sex from your spouse. So if you’re the same sex as your spouse, you can’t have one.
Fortunately, you’re still your own person and therefore you should be able to have a Roth IRA, as long as you earn the money that goes into it. Pain in the butt for full-time parents (hence the benefits of the Spousal IRA), but since the limit is $4000 $5000/year unless you’re almost at retirement, if you can earn that you can contribute.
Not being recognized by the federal government is a potential advantage here, if your spouse makes too much for you to have a Roth IRA. Because they don’t recognize the marriage, your spouse’s earnings won’t exclude you from contributing. It doesn’t really mitigate the other disadvantages, but it may help you save for retirement.
For more on Roth IRAs, I’d suggest checking out Chance Favors, which has pretty much everything you need to know. And for more on GLBTQ finance, try visiting Queercents, an excellent group blog which covers personal finance and career from a variety of viewpoints.