Can anyone help with this question?
Rita Spano is an active participant in a company retirement plan. Her husband, John, age 45, works for a company that does not have a retirement plan. The Spanos' joint adjusted gross income for 2014 is $185,000. John contributes $4,000 to an IRA for himself. How much of this $4,000 contribution for John can the Spanos deduct on their 2014 joint return?
A.
$4,000
B.
$3,200
C.
$2,000
D.
$0
Answer: B
Beginning in 1998, individuals are not considered participants in a company retirement plan simply because their spouses are. However, the maximum deductible IRA contribution for a nonparticipant spouse is phased out for couples with joint return adjusted gross incomes between $181,000 and $191,000. In this case, the Spanos' AGI is $4,000 over the beginning of the $10,000 phaseout range so their maximum $4,000 deduction is reduced by $800 ($4,000 × 2 ÷ 10) to arrive at $3,200.
Like I can understand the theory, but when it comes to calculation, no idea at all………
AUD - 69,95
BEC - 86
FAR - 82
REG - 56,82
I finally made it!!!!!Thank YOU!!!!!!!!
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