A divorced woman with 2 young children has a small trust fund that gives her $2,500 a year in income. She collects another $2,500 per year in alimony payments. The woman wishes to make a contribution to an Individual Retirement Account this year. Which statement is TRUE

No contribution can be made

Explanation:

The options to the question are:

a. No contribution can be made

b. A contribution can be made based only on the income received from the trust fund.

c. A contribution can be made based only on the alimony payments received

d. A contribution can be made based on both the income received from the trust fund and the alimony payments received

From the question, we are informed that a divorced woman with 2 young children has a small trust fund that gives her $2,500 a year in income and that she collects another $2,500 per year in alimony payments.

Based on the above analysis, the woman cannot make a contribution to an Individual Retirement Account this year.

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