@Hal_Al wrote:
In addition, the amount of the income must be reduce by the deduction for 1/2 the self employment tax. Effectively only 92.35% of her 1099-NEC income is eligible for an IRA contribution.
As best as I can tell, the "92.35%" relates only to the amount of SE income that is taxable (Topic No. 554 Self-Employment Tax | Internal Revenue Service (irs.gov)) For purposes of determining eligible IRA contributions, all of the SE income, minus SE tax, is the number (Publication 590-A (2021), Contributions to Individual Retirement Arrangements (IRAs) | Internal Reve...) This is what TT for 2021 calculated for me (but didn't tell me it had done so, which led to quite a bit of head-scratching.)
