Steven Is 27 Years Old and Has a Total AGI

question 58

Multiple Choice

Steven is 27 years old and has a total AGI of $110,000 in 2019. He contracts pneumonia in 2019 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 59½ 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 these is correct

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Definitions:

Union Contracts

Legally binding agreements between unions and employers detailing wages, hours, and working conditions for employees.

Management Rights Clause

A provision often found in collective bargaining agreements that delineates certain functions and decisions that are reserved for management's discretion.

Union Security Clause

A union security clause in a collective bargaining agreement requires all employees in the bargaining unit to become union members or pay union dues, ensuring union support and financial stability.

Seniority Rights

Involve privileges or benefits granted to employees based on their length of service with an employer, often affecting job security, promotions, and layoffs.