Clarke works in a manufacturing company as a production supervisor.He participates in the employer-sponsored retirement plan.For Clarke, the maximum amount of tax-deferred IRA contribution depends on:
A)income earned from fixed investments alone.
B)income earned from work alone.
C)income earned from work and fixed investments.
D)Income earned from work and social security.
E)Income earned from employment and non-employment sources.

Question

Quizplus · Accepted Answer

The maximum amount of tax-deferred IRA contribution primarily depends on income earned from work, as IRA contributions must be based on earned income, which includes wages, salaries, commissions, tips, bonuses, or net income from self-employment. Income from fixed investments, social security, or other non-employment sources does not qualify as earned income for IRA contributions.

Clarke Works in a Manufacturing Company as a Production Supervisor