Which of the following statements regarding traditional IRAs is true? Multiple Choice A single taxpayer with no earned income is not allowed to deduct contributions to traditional IRAs. Once a taxpayer reaches 55 years of age she is allowed to contribute an additional $1,000 a year. Taxpayers who participate in an employer-sponsored retirement plan are allowed to deduct contributions to a traditional IRA regardless of their AGI. Taxpayers with high income are not allowed to contribute to traditional IRAs.
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28. Randy (age 42) wants to open an IRA for retirement and tax advantages. Randy meets the eligibility requirements necessary to make an IRA contribution. Which of the following statements concerning Randy's IRA contributions is accurate? a) Randy must make a traditional IRA contribution. b) Randy must make a Roth IRA contribution. c) If Randy chooses to make a contribution to a traditional IRA, his contribution will be nondeductible due to his age. d) Randy can make a contribution to a traditional or Roth IRA; however, his contribution could be limited.
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Ms. Ray is age 46 and single. Her employer made a $2,895 contribution to her qualified profit-sharing plan account, and she made the maximum contribution to her traditional IRA. Compute her IRA deduction if: a. Ms. Ray's $50,000 salary is her only income item. b. Ms. Ray's $68,250 salary is her only income item. c. Ms. Ray's $68,250 salary and $7,970 dividend income are her only income items. Assume the taxable year is 2018.
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