Which of the Following Is True About Future Qualified Distributions

question 31

Multiple Choice

Which of the following is true about future qualified distributions from a Roth IRA by a person who will be 65 years old at the time the distributions begin? Assume the individual opened the account before age 60.

• A)The entire amount of the distributions will be tax-free.
• B)Only the accumulated earnings will be tax-free.
• C)Only the previous contributions will be tax-free.
• D)The entire amount of the distribution will be taxable.

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Definitions:

Liability

A financial obligation or responsibility, often legal in nature, that an entity or individual has to another.

Agent

An individual authorized to act on behalf of another party, known as the principal, in dealings with third parties.

Doctrine Of Respondeat Superior

This legal principle holds an employer or principal legally responsible for the wrongful acts of an employee or agent, performed within the scope of employment or agency.

Tortious Behavior

Actions that cause harm or loss to another person, leading to civil legal liability.