Q: I opened a Roth IRA about 15 years ago before I married my present husband and I’ve contributed a little to it over the years. Now that I’m retired and no longer bringing in any income, can I still contribute to my Roth IRA? If so, are there any special stipulations I should be aware of?

I receive only Social Security income, but share my husband’s pension and his Social Security income. The Roth IRA is currently in my name and my husband’s name in trust. Also, some years ago, I converted my 401(K) and invested in a deferred annuity. If I were to withdraw some of this money, would I be able to contribute it to the Roth IRA? I am 66 and my husband is 72. –S.S., Casa Grande, Ariz.

A: I posed this question to the IRA team at Fidelity Investments. Their reply: “In order to contribute to a Roth IRA, you (or your spouse, if filing joint) must have earned income. Earned income would not include Social Security or pension. Regarding the deferred annuity–yes, if the money is invested in an annuity, you may be eligible to convert some of it to a Roth IRA. However, you should be aware that this would be a taxable event, and you would still need to meet the eligibility requirements for a Roth. Also, keep in mind that the annuity may be subject to surrender fees which may offset the benefit of the conversion.”

Q: I know that Roth IRA income does not affect Social Security payments. I also know that Social Security Disability has some different rules. I am 62 and have been on Disability since January, 2005. I have a Roth IRA and a retirement annuity account. If I start taking payments from these accounts, will it affect my disability income? I need about $300 a month in addition to my disability to meet my monthly expenses. –H.K., via the Internet

A: Any income that you receive from these accounts will not affect Social Security Disability Insurance (SSDI) benefits, says Paul Gada, personal financial planning director at Allsup, which provides counseling on SSDI and Medicare services. “To qualify for and retain SSDI benefits, you must be unable to do substantial, gainful activity,” Gada says. “This essentially means work, which in turn, involves earned income.”

“Retirement accounts, as well as other personal savings and investments, are not classified as earned income from work, so they do not impact SSDI eligibility. There may be some confusion here with Supplemental Security Income (SSI), which is a means-based program. To qualify for and retain SSI benefits, you must meet very specific financial requirements with very strict income and asset restrictions. This is not the case, however, with SSDI benefits.”

Q: My wife and I have three IRA accounts and one joint account that is not an IRA. Can we transfer from our IRAs (stock) to our joint account, and will they be considered as satisfying our annual required minimum withdrawal distribution? –L.B., via the Internet

A: “A distribution of stock from an IRA to a personal account–individual or joint with a spouse–does qualify as a minimum required distribution,” says Jim Lange, author of Retire Secure! Pay Taxes Later-The Key to Making Your Money Last (Wiley, 2009). “Of course, minimum distributions were suspended by the federal government in 2009. In fact, most seniors with incomes of less than $100,000 would be well advised to make a Roth IRA conversion before required distributions return next year, while their income (and hence their tax bracket) is as low or lower than it will ever be again.”

Q: I have Medicare Parts A and B, plus a United Autoworkers’ supplemental policy. Can I still purchase a Medigap insurance policy, and would that be a wise choice?–R.L., via the Internet

A: Due to the complexities of supplemental Medicare policies, you should sort this out with the help of the free Medicare counseling services available from the State Health Insurance Assistance Programs (SHIP). These free, personalized counseling services are available in every state. Click here to find your local SHIP.

Related posts:

1. Reader mailbag: Roth IRAs, Social Security and IRA withdrawals
2. Reader mailbag: Do IRA Withdrawals Affect Social Security Benefits?
3. Reader mailbag: Working while receiving Social Security disability
4. Reader Q&A: IRA withdrawals and taxes
5. Reader mailbag: Allocations, Social Security taxes and Roths

Tags | Medicare, Q&A, RMDs, Roth IRA