FI 413 Lecture Notes - Lecture 22: Tax Deduction, Single Tax, Traditional Ira
Document Summary
Individual retirement accounts (iras) must be labor income two different kinds traditional or roth ira. Anyone with ,500 or more in employment income can contribute up to ,500 a year to iras for 2016 and can be split between the two different types. Over 55 you can contribute an additional ,000. Assume expected income is about the same in 2017 as in: should the individual assign the ira contribution to 2017 or to 2016, can do either but 2016 is better. Can do more later in 2017: what are the legal limitations on loans from iras, and the legal limitations on pre- retirement withdrawals from iras, no loans from iras can take it out but iras will seek penalty. Traditional iras can deduct contributions from taxable income. Single tax payers with agi less than ,000 can take the full contribution as a tax deduction. Mfj tax payers the agi limit is 98,000 with phase out deductions of 118,000.
