Question

1. Which of the following taxpayers may make a contribution to a traditional IRA? All have a single filing status.

A. Chloe (64) has an AGI of $36,000 consisting of pension income of $17,000, interest of $5,125, dividends of $6,775, and net rental income of $7,100.

B. Jarred (74) has an AGI of $63,230 consisting of wages of $45,955, taxable social security of $12,895, and interest income of $4,380.

C. Kerri (78) has an AGI of $9,450 consisting solely of interest.

D. Pharrell (48) has an AGI of $79,890 consisting of net rental income of $72,000 and dividend income of $7,890.

2. Kelly, age 53, has an AGI of $113,429 and files head of household claiming her three children. She paid $15,253 for orthodontia for the children and she has $16,981 in other itemized deductions. What is Kelly's medical and dental expense deduction for 2020?

A. $11,343

B. $6,746

C. $3,910

D. $0

Answer 1

1) A) is the correct answer for becoming eligible for the traditional IRA because the criteria is, the age should be less than 70.5 years and the income of this particular person is coming under the criteria.

2) B) is the correct answer because you can deduct only the amount of your total medical expenses that exceed 7.5% of your adjusted gross income.