2023 Roth IRA Contribution
I have a client (files single) who had an AGI of $21,534 in 2023. She had $1,392 of self-employment income reported on Schedule 1, part 1, line z not on a Schedule C.
Her self-employment tax was $196 and the deductible part of the self-employment tax was $98.
What is her maximum 2023 Roth IRA contribution? Is it $1,392 (income)-$196 (self-employment tax)=$1,196.
Permalink Submitted by Alan - IRA critic on Thu, 2024-04-11 18:01
Without a Sch C to properly report self employment income and Sch SE, there is no documentation to support an IRA contribution. The max Roth contribution would be 1392 less 98 (1/2 of SE tax) or 1294 if the self employment income was properly reported, but the IRS may ignore this due to the small amount of income. Line z should also include a description of the income being reported.