Contribution Calculation for "Simple IRA" plus Roth IRA Eligibility

[HCM]

Taxpayer is self-employed: zero employees. Has a "Simple IRA" with 100% contribution for self + a 3% matching contribution. Schedule C income = $12,000 (before SS calc.).

1) How much can he contribute to "Simple IRA"?
2) How much is "matching contribution"?
3) Since taxpayer had a 100% contribution, can he still contribute to a ROTH IRA too?

[New York Enrolled Agent]

Taxpayer is self-employed: zero employees. Has a "Simple IRA" with 100% contribution for self + a 3% matching contribution. Schedule C income = $12,000 (before SS calc.).

1) How much can he contribute to "Simple IRA"?
2) How much is "matching contribution"?
3) Since taxpayer had a 100% contribution, can he still contribute to a ROTH IRA too?

No one wants to answer so I'll give it a try.

1. $11,082
2. $332
3. No

[liberty]

Simple IRA

Can you show me how do you come up with that number?

[kathyc2]

He can still contribute to a Roth if he has other earned income or spouse has earned income.

[New York Enrolled Agent]

Can you show me how do you come up with that number?

1. Compensation for purposes of SIMPLE = line 4 of Form SE. Poster used $12,000 as Schedule C income. Line 4 = .9235 x $12,000 = $11,082
2. Matching = 3% of amount contributed. 3% of $11,082 = $332
3. All the taxpayer's compensation was used for the SIMPLE. There is no compensation left for the Roth.

My answers are based on the facts in the post. Kathy noted there could be other facts that could change the no but I choose not to speculate. For example, if the taxpayer had a 401K deferral, answer 1. would more likely than not change. I only used the limited facts presented.