Chee Is a Key Employee of an H

question 43

Essay

Chee is a key employee of an H.R 10 (Keogh) defined contribution plan (a profit sharing plan) created by a partnership. Answer each of the following independent questions.
a.During 2017, $7,400 is contributed to the H.R. 10 plan for Chee. What amount is deductible if Chee's earned income is $45,000 (after the deduction for one-half of self employment tax)?
b.In 2017, $8,020 is contributed to the H.R. 10 (Keogh) plan on Chee's behalf. If Chee's earned income is $36,000 (after the deduction for one-half of self employment tax), what deduction, if any is allowed?
c.The partnership had a bad year in 2017, and only $820 was contributed to the H.R. 10 plan on Chee's behalf. Chee earned only $700 during 2017. Calculate Chee's allowable deduction.

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