High School

Myers, who is single, has compensation income of $76,000 in 2022. He is an active participant in his employer's qualified retirement plan. Myers contributes $6,000 to a traditional IRA. Therefore, of the $6,000 contribution, Myers can deduct $5,040.

Answer :

Of the $6,000 contribution, myers can deduct $ 5,040.

How to calculate IRA deduction?

According to Exhibit 11.2, which outlines the phaseout of IRA deductions for active participants, Myers falls within the phaseout range for single filers in 2022 (between $68,000 and $78,000).

As a 7result, Myers' IRA deduction will be reduced proportionally.

Since Myers' income is $8,000 above the lower limit of the phaseout range ($76,000 - $68,000 = $8,000), his IRA deduction will be reduced by 80% (8,000 / 10,000 = 0.8).

Therefore, of the $6,000 contribution, Myers can deduct $5,040 (0.8 * $6,000 = $1,200 reduction; $6,000 - $1,200 = $5,040).

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