For each taxpayer, compute the maximum contribution to the retirement plan. 1a. Lewis, a self-employed individual, has net earned income of $50,000 in 2021. If Lewis has no employees, calculate the maximum contribution to a SEP plan that he may deduct from his adjusted gross income. $fill in the blank b. During 2021, Linda, age 32, has a salary of $40,000. She participates in a Section 401(k) plan and chooses to defer 25 percent of her compensation. 1b. What is the maximum amount Linda can contribute to the Section 401(k) plan on a tax-deferred basis? $fill in the blank 2b. If Linda's salary was $125,000, instead of $40,000, what is the maximum amount that she could contribute to the Section 401(k) plan on a tax-deferred basis?
For each taxpayer, compute the maximum contribution to the retirement plan. 1a. Lewis, a self-employed individual, has net earned income of $50,000 in 2021. If Lewis has no employees, calculate the maximum contribution to a SEP plan that he may deduct from his adjusted gross income. $fill in the blank b. During 2021, Linda, age 32, has a salary of $40,000. She participates in a Section 401(k) plan and chooses to defer 25 percent of her compensation. 1b. What is the maximum amount Linda can contribute to the Section 401(k) plan on a tax-deferred basis? $fill in the blank 2b. If Linda's salary was $125,000, instead of $40,000, what is the maximum amount that she could contribute to the Section 401(k) plan on a tax-deferred basis?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:For each taxpayer, compute the maximum contribution to the retirement plan.
1a. Lewis, a self-employed individual, has net earned income of $50,000 in 2021.
If Lewis has no employees, calculate the maximum contribution to a SEP plan that he may deduct from his adjusted gross
income. $fill in the blank
b. During 2021, Linda, age 32, has a salary of $40,000. She participates in a Section 401(k) plan and chooses to defer 25
percent of her compensation.
1b. What is the maximum amount Linda can contribute to the Section 401(k) plan on a tax-deferred basis? $fill in the blank
2b. If Linda's salary was $125,000, instead of $40,000, what is the maximum amount that she could contribute to the
Section 401(k) plan on a tax-deferred basis?
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