Tyne is a 48-year-old an unmarried taxpayer who is not an active participant in an employer-sponsored qualified retirement plan.Before IRA contributions,her AGI is $64,000 in 2015.What is the maximum amount she may contribute to a tax deductible IRA?
A)$ 0
B)$4,400
C)$5,500
D)$6,500

Question

Quizplus · Accepted Answer

As per the IRS contribution limits for 2015, a person who is not an active participant in an employer-sponsored retirement plan and is over 50 years old can contribute up to $6,500 to a tax-deductible Traditional IRA. Since Tyne is 48 years old, she would fall under the under 50 age bracket and can contribute up to $5,500 to a tax-deductible Traditional IRA. Therefore, the maximum amount she may contribute to a tax deductible IRA is $5,500. Option A is incorrect because even though she is not an active participant in an employer-sponsored retirement plan, she still qualifies to contribute to IRA, however, the contribution would be non-deductible. Option B is incorrect because the contribution limit for 2015 for a person under 50 years old is $5,500, not $4,400. Option D is incorrect because; she is under 50 years old, therefore, the contribution limit is $5,500 not $6,500.

Tyne Is a 48-Year-Old an Unmarried Taxpayer Who Is Not