In 2018, Susan's sole proprietorship earns $300,000 of self employment net income (after the deduction for one-half

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In 2018, Susan's sole proprietorship earns $300,000 of self employment net income (after the deduction for one-half of self employment tax).

a. Calculate the maximum amount that Susan can deduct for contributions to a defined contribution Keogh plan.

b. Suppose Susan contributes more than the allowable amount to the Keogh plan. What are the consequences to her?

c. Can Susan retire and begin receiving Keogh payments at age 58 without incurring a penalty? Explain.

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South-Western Federal Taxation 2019 Individual Income Taxes

ISBN: 9781337702546

42nd Edition

Authors: James C. Young, William H. Hoffman, William A. Raabe, David M. Maloney, Annette Nellen

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Question Posted: Aug 07, 2019 02:03 PM

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