https//newconn tion.com/flow/connect.html Help Seve & Exit Submi Check my work R

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https//newconn tion.com/flow/connect.html Help Seve & Exit Submi Check my work Required information The following information applies to the couestonis disalived below) Elvira is a self-employed taxpayer who turns 42 years old at the end of the year (201). In 2017, her net Schedule C income was $130,000. This was her only source of income. This year. Elvira is considering setting up a retirement plan. What is the maximum amount Elvira may contribute to the self Round your intermediate calculations and final answers to the nearest whole dollar amount.) oyed plan in each of the following situations? o. She sets up a SEP IRA.

Explanation / Answer

Here, I have assumed 5% as contribution %. You can change it if you have further details and find the answerr accordingly

Deduction for self-employment tax $9,184.21 Adjusted net business profit $120,815.79 Subtract the deduction for self-employment tax from your net business profit. Contribution rate 1.05 1 + your contribution percentage Earned income $115,062.66 Divide your adjusted net business profit by your contribution rate. Contribution amount $5,753.13 Multiply the lesser of the maximum earned income allowed or your compensation by your contribution percentage.

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