- This topic has 0 replies, 1 voice, and was last updated 10 years ago by
.
-
Topic
-
Sol and Julia Crane (both age 41) are married, and filed a joint return for 2013. Sol earned a salary of $125,000 in 2013 from his job at Troy Corp., where Sol is covered by his employer’s pension plan. In addition, Sol and Julia earned interest of $3,000 in 2013 on their joint savings account. Julia is not employed, and the couple had no other income. On January 15, 2013, Sol contributed $4,000 to an IRA for himself, and $4,000 to an IRA for his spouse. The allowable IRA deduction in the Cranes’ 2013 joint return is
a. $0
b. $5,000
c. $6,000
d. $10,000
(b) Julia’s $5,000 contribution is allowable but Sol’s is not because he is a participant in a pension plan and their combined compensation is greater than $115,000
Where did Julia’s $5000 come from? Her share was only $4000.
- You must be logged in to reply to this topic.
