Ian Berger, JD
IRA Analyst


Can you put funds into a Roth IRA for a 14 year old using money you have paid the child for doing chores?

Client was told all he needed to do was keep a record of what was paid by to the child.

I have always enjoyed your presentations.

Thank you,



Hi Cathy,

This a common question, but unfortunately there isn’t much guidance from the IRS on this issue. We do know that parents can open up IRAs (including Roth IRAs) for their children. However, the child mut have enough of his own “compensation” to support the IRA contribution. Here, “compensation” means taxable income, and that’s the problem.

Payments a parent makes to a child for common household chores are usually not taxable income. In that case, they can’t be used for an IRA contribution. Money that a child receives from a third-party, such as babysitting or mowing loans for neighbors, may be a different story. Those amounts may count, as long as the child claims those amounts on a tax return. Your child would want to retain good documentation of any earnings.


I retired in 2011 and rolled my Thrift Savings Plan into an IRA.  Currently I must take a RMD every year from that IRA.  If I roll over some stock from my IRA into my Roth IRA, will that qualify as a RMD (required minimum distribution) or would I have to also withdraw cash to meet the RMD requirements?


You don’t necessarily have to withdraw cash out of your traditional IRA to satisfy the RMD rules; you can also take stock out. However, no RMD (cash or stock) can ever be rolled over, and the first payments out of the traditional IRA in any year are considered  to be RMDs. So, if you want to convert all or some of your traditional IRA to a Roth IRA, you will need to first take the RMD (in cash or stock) and then convert the remainder.