What is the maximum amount that Ted is eligible to contribute to an IRA due to his filing date on May 5?

What is the maximum amount that Ted is eligible to contribute to an IRA due to his filing date on May 5?

• A. He is not eligible for any contribution
• B. Half the maximum IRA contribution
• C. The maximum IRA contribution
• D. Only a Roth IRA contribution

Answer: (C)

To understand why the maximum IRA contribution is the correct answer, it's important to consider the rules surrounding Individual Retirement Accounts (IRAs) based on filing status and contribution limits. As of 2023, assuming Ted meets the income criteria and other eligibility requirements, he can contribute up to the full annual limit to his IRA if he is under the age of 50, which is $6,500. If he is 50 or older, he can contribute an additional $1,000 as a catch-up contribution, bringing the total to $7,500. Filing his tax return on May 5 does not impact his eligibility to contribute to an IRA for the tax year as long as he adheres to the contribution deadlines, which typically extend until the tax-filing deadline of the following year (usually April 15). Ted's filing date does not restrict or limit his contribution ability. Therefore, as long as he qualifies based on age, income, and other factors, he can indeed contribute the maximum allowable amount to his IRA. Other choices may hint at specific contributions based on various provisional causes, like not allowing contributions or limiting to half the maximum, which wouldn't apply if Ted meets eligibility requirements. Additionally, the mention of only a Roth IRA contribution would

To understand why the maximum IRA contribution is the correct answer, it's important to consider the rules surrounding Individual Retirement Accounts (IRAs) based on filing status and contribution limits.

As of 2023, assuming Ted meets the income criteria and other eligibility requirements, he can contribute up to the full annual limit to his IRA if he is under the age of 50, which is $6,500. If he is 50 or older, he can contribute an additional $1,000 as a catch-up contribution, bringing the total to $7,500. Filing his tax return on May 5 does not impact his eligibility to contribute to an IRA for the tax year as long as he adheres to the contribution deadlines, which typically extend until the tax-filing deadline of the following year (usually April 15).

Ted's filing date does not restrict or limit his contribution ability. Therefore, as long as he qualifies based on age, income, and other factors, he can indeed contribute the maximum allowable amount to his IRA.

Other choices may hint at specific contributions based on various provisional causes, like not allowing contributions or limiting to half the maximum, which wouldn't apply if Ted meets eligibility requirements. Additionally, the mention of only a Roth IRA contribution would