Question regarding IRA contributions?
the max on 401k contributions is $18,000 per year.
but: you know how it has to come from "earned income"...
like, you can't just take $5,500 from your bank account and put it into an IRA....
it has to come from earned income from a job during the year.........
okay, let's say,
you have $100,000 in your bank account.
you're using your bank account to pay your bills.
You invest 100% of it into your 401k, giving you ZERO take-home pay.
but technically, you still have $18,000 of "earned income."
Question: Can you still contribute $5,500 to an IRA (based on your earned income)?
it's like you're contributing to both a 401k and an IRA with the SAME "earned income" counting twice. Is that legal?
Can you do that?