Question

Harvey is a self-employed accountant with earned income from the business of $120,000 (after the deduction for one-half of his self-employment tax). He has a profit-sharing plan (e.g., defined contribution Keogh plan). What is the maximum amount Harvey can contribute to his retirement plan in 2019? $

Answer 1

The maximum amount Harvey can contribute to his retirement plan in 2019 is $30,000.

Step-by-step explanation:

According to Keogh plan the maximum amount Harvey can contribute to his retirement plan in 2019 is 25% over the amount Harvey earned Or 53,000 Whichever is less.

Thus,

Harvey is a self-employed accountant with earned income from the business of $120,000 and its 25% is $30,000.