Can a person with foreign income contribute to a Roth IRS without penalty

[470pitt]

I used the 2555 form but it is calculating that there is a penalty

the 2555 is for 50,000 and the he contributed 6500 and the

wife worked showing only 7900 in come and she is not being penalized

[Just-Lisa-Now-]

If you excluded the income.....how can they contribute to ROTH with no earned income?

[Terry53029]

is the foreign income earned, and taxable ?

[TaxGuyBill · Accepted solution]

Please keep your questions to one thread:

https://accountants-community.intuit.com/questions/1826855-is-it-correct-that-a-penalty-is-being-cal...

They must have "taxable compensation" in order to contribute to an IRA.  So excluded income does not count.  So if they have no "taxable compensation" (such as non-excluded wages or self employment income), they are not allowed to contribute to an IRA.

If they some wages or self employment income that is not excluded, they can contribute to an IRA up to the amount of taxable compensation (or the $5500/$6500 limits).