Multiple Choice

1. Terri is single and age 32. She reported AGI of $61,000 in tax year 2014. She is an active participant in her employer’s pension plan. What is the maximum deductible IRA contribution she can make in 2014?

a. $0.

b. $1,100.

c. $4,400.

d. $5,500.

2. Ed and Cathy, both under age 50, file a joint return. Neither is covered under an employer pension plan. Ed earned compensation of $55,000 in 2014. Cathy worked part-time and earned $1,200. What is the maximum deductible IRA contribution they can make in 2014?

a. $0.

b. $5,500.

c. $6,700.

d. $11,000.

3. Vickie is single and age 53. She reported AGI of $66,000 in 2014. She is an active participant in her employer’s pension plan. What is the maximum deductible IRA contribution she can make in 2014?

a. $2,200

b. $2,600

c. $3,900

d. $6,500

4. Patrice is single and age 26. She reported AGI of $65,000 in tax year 2014. She is an active participant in her employer’s pension plan. What is the maximum deductible Roth IRA contribution she can make in 2014?

a. $0.

b. $2,200.

c. $3,300.

d. $5,500.

5. Jack is single and age 43. He reported AGI of $122,000 in tax year 2014. He is an active participant in his employer’s pension plan. What is the maximum Roth IRA contribution he can make in 2014?

a. $0.

b. $2,567.

c. $2,933.

d. $5,500.

6. Without regard to AGI limitations, what is the maximum contribution permitted to a Coverdell Education Savings Account in 2014?

a. $500

b. $2,000

c. $5,500

d. The lower of $5,500 or 100% of compensation

7. Vanessa and Martin file a joint return for 2014. They have one child age 12. They have combined AGI of $202,000 in 2014. What is their maximum permitted contribution to a Coverdell Education Savings Account for 2014?

a. $0.

b. $800.

c. $1,200.

d. $2,000.

8. Juan is single and retired on January 1, 2014 at age 62. He is entitled to receive monthly payments of $1,500 over his life from his employer’s qualified pension plan. The payments began January 1, 2014. He contributed $71,500 to the plan prior to his retirement. Using the simplified method, how much of the payments will be included in his income for 2014?

a. $0.

b. $3,300.

c. $14,700.

d. $18,000.