Raul and Jenna Are Married and Are Both Working

question 97

Essay

Raul and Jenna are married and are both working.They are both over age 50.Jenna participates in her employer's Sec.401(k)plan and makes the maximum contribution and enjoys a company matching contribution.Raul's employer does not maintain a retirement plan so he would like to save as much as possible in a tax-advantaged manner for retirement.They expect to report $187,000 of AGI for 2015.
a.What is the maximum amount that Raul can contribute to a traditional IRA and how much can he deduct?
b.What is the maximum amount that Raul can contribute to a Roth IRA and how much can he deduct?
c.How could Raul contribute to both the traditional IRA and Roth IRA to maximize current and future tax savings?

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Definitions:

Memory Location

A specific address in a computer's memory where data is stored and can be accessed by the CPU.

Fault Routine

A specific sequence in a computer program designed to handle errors or malfunctions detected during operation.

Main Routine

The primary section of code in a program that executes the main logic and calls subroutines or functions.

Subroutine

A set of instructions designed to perform a frequently used operation within a computer program, which can be called from multiple places within the main program.