Which of the following statements regarding traditional IRAs is true?
A) Taxpayers who participate in an employer-sponsored retirement plan are allowed to deduct contributions to a traditional IRA regardless of their AGI.
B) Taxpayers with high income are not allowed to contribute to traditional IRAs.
C) A single taxpayer with no earned income is not allowed to deduct contributions to traditional IRAs.
D) Once a taxpayer reaches age 55 years of age she is allowed to contribute an additional $1,000 a year.

Question

Quizplus · Accepted Answer

According to IRS rules, taxpayers can deduct contributions to a traditional IRA regardless of their AGI unless they or their spouse participates in an employer-sponsored retirement plan and their income exceeds certain limits. Taxpayers with high income may be limited in their ability to contribute to a traditional IRA, but they are not prohibited from doing so. However, a single taxpayer with no earned income is not allowed to deduct contributions to a traditional IRA. The additional $1,000 catch-up contribution is only available once the taxpayer reaches age 50.

Which of the Following Statements Regarding Traditional IRAs Is True