Barbara is a single taxpayer who had a 2020 adjusted gross income of $25,000 and contributed $4,000 to her traditional IRA. Assuming she has a $2,000 income tax liability for the year, what is her maximum retirement contribution savings credit

Answers

Answer 1

Answer:

$200

Explanation:

The retirement contribution savings credit is designed to benefit low and middle income tax payers that contribute to retirement accounts.

The maximum credit ranges from $200 to $1,000 per taxpayer.

Since Barbara earned below $32,500, she applies for this tax credit.

Since her AGI is over $21,251, she can only deduct 10% of the first $2,000 contributed to her IRA account = $2,000 x 10% = $200


Related Questions

SartainC orporation is planning its annual budget and has the following beginning and ending inventory levels planned for the year.

Beginning Inventory Ending Inventory
Finished goods (units) 22,000 32,000
Raw material (grams) 52,000 42,000

Each unit of finished goods requires 3 grams of raw material. The company plans to sell 170,000 units during the year. How much of the raw material should the company purchase during the year?

a. 552,000 grams
b. 540,000 grams
c. 530,000 grams
d. 582,000 grams

Answers

Answer:

c.530,000 grams

Explanation:

Calculation for How much of the raw material should the company purchase during the year

First step is to prepare the Production Budget

PRODUCTION BUDGET

Budgeted unit sales 170,000

Add desired ending finished goods inventory

32,000

Total 202,000

(170,000+32,000)

Less beginning finished goods inventory (22,000)

Required production in units 180,000

(202,000-22,000)

Second step is to prepare Materials Budget

MATERIALS BUDGET

Raw materials required for production 540,000

(180,000*3 grams)

Add desired ending finished goods inventory

42,000

Total raw materials needed 582,000

(540,000+42,000)

Less beginning finished goods inventory (52,000)

Required material purchases 530,000 grams

(582,000-52,000)

Therefore the amount of the raw material that the company should purchase during the year is $530,000 grams

Which of the following is NOT a step involved in creating a budget?
Gather financial records
O Track spending
O Expand earning avenues
Balance the budget

Answers

Answer:

expand earning avenues

Explanation:

Expand Earning Avenues is not a step involved in creating a budget. Hence, option C is appropriate.

What does it mean to Create a Budget?

Creating a Budget is one of the most important things, which signifies that during a particular fiscal year or for a short time, a company, an institute, or something of much more importance does follow a certain type of Budget related behavior.

Creating a Budget is being done for a lot of things including the most important thing is to keep proper track of the proceedings which are being gone on.

Budget creation is done annually in the parliament to produce a lot of things on which the Government will run the country. The other most important factor is the process of combining the percentage of the money which is going to be spent.

Hence, option C is correct.

Learn more about Creating Budgets here:

https://brainly.com/question/18484668

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