Determine the maximum contribution that can be made to a Keogh plan in each of the following cases. In all instances, the individual is self-employed, and the self-employment tax reduction has already been taken. Required: a. Self-employment income of $61,800. b. Self-employment income of $61,800 and wage income of $32,000. c. Self-employment income of $125,000. d. Self-employment income of $319,000. Keogh Plans Self-employed individuals are not employees, so they cannot participate in a qualified pension or profit-sharing plan established by an employer. However, they can establish an individual Keogh plan, which is subject to the same contribution and benefit limitations as pension or profit-sharing plans. For defined contribution Keogh plans, self-employed individuals can contribute the lower of $61,000 or 25% of earned income from self-employment. 23 For purposes of the calculation, earned income cannot exceed $305,000.24 Earned income from selfemployment is determined after the deduction for one-half of the self-employment taxes paid and after the amount of the Keogh contribution. Ahmed is a self-employed architect. In 2022, his earnings, before the Keogh deduction but after deduction for one-half the self-employment tax, are $60,000. His Keogh deduction for purposes of the 25% calculation is $60,0000.25X=XThus,X=$48,000 where X is the amount of self-employment income after the Keogh deduction. Ahmed is entitled to contribute the lower of $61,000 or $12,000 ( 25% of $48,000 ). Thus, his maximum Keogh contribution is $12,000. Defined benefit Keogh plans are subject to the $245,000/100% benefit limitations given previously for qualified defined benefit plans. Keogh plans must be established by the end of the tax year (once established, the plan continues from year to year). Contributions are required no later than the due date of the return, including extensions. 25 If a self-employed individual has employees, the Keogh plan must also cover full-time employees under the same nondiscrimination, vesting, and other rules established for qualified plans. Contributions for these employees are deductible by the self-employed individual on Schedule C. Determine the maximum contribution that can be made to a Keogh plan in each of the following cases. In all instances, the individual is self-employed, and the self-employment tax reduction has already been taken. Required: a. Self-employment income of $61,800. b. Self-employment income of $61,800 and wage income of $32,000. c. Self-employment income of $125,000. d. Self-employment income of $319,000