Question

Venkat is age 32, single, and reported AGI of $70,000 in tax year 2019. He is an active participant in his employer's pension plan. What is the maximum deductible IRA contribution he can make in 2019?

A) $0.

B) $2,400.

C) $3,600.

D) $6,000.

Jill is single, age 27, and reported AGI of $66,000 in tax year 2019. She is an active participant in her employer's pension plan. What is the maximum deductible Roth IRA contribution she can make in 2019?

A) $0.

B) $1,200.

C) $4,800.

D) $6,000.

Answer 1

Ans:

1.

For income upto $64,000, Maximum deduction will be $6,000 for IRA contribution linked to an active pention plan. The deduction phase out at $74,000. Deduction of income of $70,000 is $2,400. ($600 phase out for every $1,000 increase in income).

So correct answer is option B.

2.

For roth IRA deduction on income upto $122,000 for single individual. deduction of $6,000 is allowed.

So maximum deductible contribution is $6,000.

So correct answer is option D.

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