Income Tax Fundamentals 2020
38th Edition
ISBN: 9780357391129
Author: WHITTENBURG
Publisher: Cengage
expand_more
expand_more
format_list_bulleted
Question
thumb_up100%
Chapter 5, Problem 7MCQ
To determine
Introduction:There are two types of individual retirement accounts in the United States, the traditional IRA and Roth IRA. Traditional IRA allows the deduction of annual contributions and retirement distributions are taxable. While the annual contribution to Roth IRA is not deductible and retirement distributions are non-taxable. In addition earnings on both are not taxable in the current year.
To choose:The correct answer to determine maximum amount D can contribute to Roth IRA.
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
What is the maximum IRA contribution that Josh can make under each of the following assumptions?
Required:
a. Josh is age 20 and single. Josh's only income item is $13,600 interest from a trust fund.
b. Josh is age 40 and single. Josh's only income item is a $34,600 share of ordinary income from a partnership.
c. Josh is age 60 and single. Josh's only income item is $29,000 wages.
d. Josh is age 46 and files a joint return with a spouse. Josh's sole proprietorship generates a $7,390 loss, and the spouse's salary is
$49,800.
a. Maximum contribution
b. Maximum contribution
c. Maximum contribution
d. Maximum contribution
Amount
A married couple has income of $35,000 and Social Security benefits of $25,000. What amount of their Social Security
benefits must be included in their taxable income?
Group of answer choices
$0
$5,500
$7,750
$12,500
You and your spouse have the following retirement accounts. Tell me how much you can take out or
borrow from each account without incurring a tax penalty. Assume that you are a first time home
buyer and you are in the 17% Federal and state tax brackets.
Your IRA $9,000
Your Spouse's IRA $8,000
Your Roth IRA $18,000 (10,000 of contributions)
Your Spouse's Roth $15,000 (8,500 of contributions)
Your 401(k) $110,000
Based on the information above, answer the following questions:
* number your answers 1,2,3
1) How much can you take out or borrow without penalty for a down payment?
2) What is the maximum amount you can pay for a house if you put 20% down. Assume that you
can borrow any amount.
Chapter 5 Solutions
Income Tax Fundamentals 2020
Ch. 5 - Prob. 1MCQCh. 5 - Prob. 2MCQCh. 5 - Prob. 3MCQCh. 5 - Which of the following is true about the...Ch. 5 - Lyndon, age24, has a nonworking spouse and earns...Ch. 5 - Prob. 6MCQCh. 5 - Prob. 7MCQCh. 5 - Prob. 8MCQCh. 5 - Prob. 9MCQCh. 5 - Prob. 10MCQ
Ch. 5 - Prob. 11MCQCh. 5 - Prob. 12MCQCh. 5 - Prob. 13MCQCh. 5 - Prob. 14MCQCh. 5 - Eliza is a kindergarten teacher for Alexander...Ch. 5 - Prob. 16MCQCh. 5 - Prob. 17MCQCh. 5 - Prob. 18MCQCh. 5 - Prob. 19MCQCh. 5 - Prob. 20MCQCh. 5 - Prob. 21MCQCh. 5 - Prob. 22MCQCh. 5 - Prob. 23MCQCh. 5 - Prob. 24MCQCh. 5 - Prob. 25MCQCh. 5 - Prob. 26MCQCh. 5 - Prob. 27MCQCh. 5 - Prob. 28MCQCh. 5 - Prob. 29MCQCh. 5 - Prob. 30MCQCh. 5 - Which of the following would typically be...Ch. 5 - Which of the following is not a possible...Ch. 5 - Prob. 33MCQCh. 5 - Prob. 34MCQCh. 5 - Evan participates in an HSA carrying family...Ch. 5 - Prob. 2PCh. 5 - Karen, 28 years old and a single taxpayer, has a...Ch. 5 - Phil and Linda are 25 -year-old newlyweds and file...Ch. 5 - Prob. 5PCh. 5 - Prob. 6PCh. 5 - Prob. 7PCh. 5 - Bob is a single, 40 -year-old doctor earning...Ch. 5 - Prob. 9PCh. 5 - During 2019 , Jerry is a self-employed therapist,...Ch. 5 - Prob. 11PCh. 5 - Prob. 12PCh. 5 - Prob. 13PCh. 5 - Prob. 14PCh. 5 - Janet needs an elevator seat attached to her...Ch. 5 - Lyndon's employer withheld $10,100 in state income...Ch. 5 - Mike sells his home to Jane on April 2,2019 . Jane...Ch. 5 - Prob. 20PCh. 5 - Prob. 21PCh. 5 - Prob. 22PCh. 5 - Ken paid the following amounts for interest during...Ch. 5 - Prob. 24PCh. 5 - Prob. 25PCh. 5 - At the end of 2019, Mark owes $250,000 on the...Ch. 5 - Prob. 27PCh. 5 - Prob. 28PCh. 5 - Prob. 29PCh. 5 - Prob. 30PCh. 5 - On January 3,2019, Carey discovers his diamond...Ch. 5 - Prob. 32PCh. 5 - Prob. 33P
Knowledge Booster
Similar questions
- Virginia and Richard are married taxpayers with adjusted gross income of $28,000 in 2019 If Virginia is able to make a $1,500 contribution to her IRA and Richard makes a $1,500 contribution to his IRA, what is the Saver's Credit Virginia and Richard will be eligible for? $0 $1,500 $2,000 $3,000 $4,000arrow_forwardDarrell is an employee of Whitneys. During the current year, Darrells salary is 136,000. Whitneys net self-employment income is also 136,000. Calculate the Social Security and self-employment taxes paid by Darrell and Whitney. Write a letter to Whitney in which you state how much she will have to pay in Social Security and self-employment taxes and why she owes those amounts.arrow_forwardLeroy and Amanda are married and have three dependent children. During the current year, they have the following income and expenses: Salaries 120,000 Interest income 45,000 Royalty income 27,000 Deductions for AGI 3,000 Deductions from AGI 9,000 a. What is Leroy and Amandas current year taxable income and income tax liability? b. Leroy and Amanda would like to lower their income tax. How much income tax will they save if they validly transfer 5,000 of the interest income to each of their children? Assume that the children have no other income and that they are entitled to a 1,050 standard deduction.arrow_forward
- Maniarrow_forwardHaley (age 48) and Myron (age 51) are married and filing a joint return. Myron has earned income of $42,000 and is not covered by an employer plan. Haley is a homemaker and does not work outside the home. What is the total amount they can deduct for contributions to traditional IRAs for both Haley and Myron? Select one: a. $6,500 b. $11,000 c. $13,000 d. $12,000arrow_forwardPeter and Joan are married and Joan has self-employment income of $240,000. Peter is retired. How much additional 0.9% Medicare tax will Peter and Joan owe with their 2019 income tax return? a.$0 b.$2,160 c.$360arrow_forward
- Shoshan, age 63, retired and began receiving retirement benefits on January 1, 2021. The benefits will be paid for the joint lives of Shoshan and his wife, Aviva, age 67. Shoshan had $36,000 in after-tax contributions to his qualified plan and had received no distributions prior to retirement. How much will Shoshan and Aviva be able to exclude from each of the annuity payments? a. $100 b. $116 c. $138 d. $171 which is correct a, b, c. or d?arrow_forwardAlex earns an income of $60,000 this year as a sole proprietor. He pays the following amounts during the year: · Contribution to Roth IRA: $5,000 · Self-Employment Tax: $9,000 · Health Insurance Premiums: $3,000 What is Alex’s Adjusted Gross Income (AGI)? Group of answer choices $47,500. $51,000. $52,000. $52,500.arrow_forwardGodoarrow_forward
- Jackson and Ashley Turner (both 45 years old) are married and want to contribute to a Roth IRA for Ashley. In 2023, their AGI is $224,500. Jackson and Ashley each earned half of the income. Note: Leave no answers blank. Enter zero if applicable. Problem 13-73 Part a (Algo) . How much can Ashley contribute to her Roth IRA if they file a joint return? Contribution to Roth IRA $ 1,800arrow_forwardAmy earns an income of $50,000 this year as an employee of Rooster Enterprises. She pays the following amounts during the year: · Contribution to Traditional IRA: $5,000 · Pre-Tax Cuts & Jobs Act Alimony she paid to her ex-husband: $10,000 · Medical Expenses: $6,000 What is Amy’s Adjusted Gross Income (AGI)? Group of answer choices $29,000. $34,000. $35,000. $39,000.arrow_forwardNonearrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Individual Income TaxesAccountingISBN:9780357109731Author:HoffmanPublisher:CENGAGE LEARNING - CONSIGNMENT
Individual Income Taxes
Accounting
ISBN:9780357109731
Author:Hoffman
Publisher:CENGAGE LEARNING - CONSIGNMENT