1. Bob is 35 years old and currently unemployed. His spouse is employed. Their combined AGI for the year is expected to be 198,000. They will file jointly. The primary component of AGI is Bob’s spouse’s wages. Bob would like to make a deductible contribution to his IRA and in the largest amount possible (without penalty).

   1. a) Bob cannot make a deductible contribution as he does not have any compensation.

   2. b) Bob cannot make a deductible contribution unless his spouse is an active participant is

      its employer’s retirement plan.

   3. c) Bob can make a deductible contribution in the amount of $3,000.

   4. d) Bob can make a deductible contribution in the amount of $6,000.

   5. e) None of the above

3. Distributions from a Traditional IRA will be treated as ordinary income and subject to income taxes:

1. a) Only if the withdrawal is considered an “early distribution”

2. b) Only if the withdrawal is made between the ages of 59 1⁄2 and 70 1⁄2.

3. c) In all instances unless the taxpayer had basis in the contribution

4. d) In all instances unless the taxpayer inherited the account.

e) None of the above.

Answer rating: 100% (QA)

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