Steven Is 27 Years Old and Has a Total AGI

question 13

Multiple Choice

Steven is 27 years old and has a total AGI of $110,000 in 2015. He contracts pneumonia in 2015 and incurs a medical bill that totals $7,500. He withdraws $7,500 from his traditional IRA to pay the bill. Which of the following is true?

• A)He is not subject to penalties on the IRA withdrawal because it was for medical expenses.
• B)He is not subject to penalties on the IRA withdrawal because he was disabled by pneumonia for 2 weeks.
• C)He is subject to penalties on the IRA withdrawal because a person may not take a withdrawal from a traditional IRA until they are 59 ½ years old no matter what.
• D)He is subject to penalties on the IRA withdrawal because the withdrawal did not cover a portion of medical bills that exceeded 10 percent of his AGI.
• E)None of the above is correct.