Detailed Answer
(d) The requirement is to determine the Lees’ maximum
IRA contribution and deduction on a joint return for 2013.
Since neither taxpayer is covered by an employer-sponsored
pension plan, there is no phase-out of the maximum deduction
due to the level of their adjusted gross income. For married taxpayers
filing a joint return, up to $5,500 can be deducted for contributions
to the IRA of each spouse (even if one spouse is not
working), provided that the combined earned income of both
spouses is at least equal to the amounts contributed to the IRAs.
Additionally, an individual at least age 50 can make a special
catch-up contribution of $1,000 for 2013, resulting in an increased
maximum contribution and deduction of $6,500 for
2013. Thus, the Lees may contribute and deduct a maximum of
$13,000 to their individual retirement accounts for 2013, with a
maximum of $6,500 placed into each account.