Tax Rules For Ira Contributions
January 24th, 2006
Question: PLEASE HELP! online poker income- can i make IRA contirubtion?
my only income for the year was about 12000 in online poker income. i want to make a 5000 IRA contribution to eliminate tax liability. Is this “earned” income and can i do this? wasnt there a legal case which ruled it as eaerned.
Answer: If you were a professional and you could report the income on Schedule C, you would be entitled to fund an IRA. However, you would also be required to pay about $1,800 of self-employment taxes which is probably more than you owe now. So you wouldn’t save taxes.
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