May a non-resident contribute to Roth IRA?

[Guest Daniel2]

I am a visiting scholar to USA on J1 visa. My income this year is totally exempted from the tax according the a TAX Treaty with USA. Can I set up a roth IRA using my paycheck money which can be considered "non-taxable" or "after tax" money?

Thanks a lot

[Michael Devault]

Welcome to the U.S. Hope you enjoy your visit.

I'm not sure that you would benefit from contributing to a Roth IRA. One of the advantages of a Roth IRA is that non-deductible contributions generally grow income tax free. If you are exempt from U.S. taxes, there seems to be no advantage to you to have a Roth IRA.

Further, the ability to contribute to a Roth IRA is based on "compensation," as defined in the Internal Revenue Code. In this definition, compensation excludes amounts not included in income, such as foreign earned income. If your earnings are not included in taxable U.S. income, you couldn't make a contribution based on those earnings.

Hope this is of some help to you.