Sean (Age 74 at End of 2017)retired Five Years Ago

question 111

Essay

Sean (age 74 at end of 2017)retired five years ago.The balance in his 401(k)account on December 31,2016 was $1,700,000 and the balance in his account on December 31,2017 was $1,750,000.In 2017,Sean received a distribution of $50,000 from his 401(k)account.Assuming Sean's marginal tax rate is 25 percent,what amount of the $50,000 distribution will Sean have left after paying income tax on the distribution and paying any minimum distribution penalties (use the IRS table below in determining the minimum distribution penalty,if any).
$$\begin{array} { c c c } \text { Age of Participarit } & \text { Distribution Period } & \text { Applicable Percentage } \\70 & 27.4 & 3.65 \% \\71 & 26.5 & 3.77 \% \\72 & 25.6 & 3.91 \% \\73 & 24.7 & 4.05 \% \\74 & 23.8 & 4.20 \% \\75 & 22.9 & 4.37 \%\end{array}$$

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Definitions:

Urea

An organic compound and waste product produced in the liver, resulting from the metabolism of proteins, excreted in the urine.

Amphibians

A class of cold-blooded vertebrates that includes frogs, toads, salamanders, and newts, characterized by their ability to live both in water and on land.

Mammals

Warm-blooded vertebrates characterized by the presence of mammary glands, which females use to feed their young, and usually hair or fur on their bodies.

Aquatic Animals

Animals that live in water for most or all of their lives, including fish, amphibians, and various invertebrates, adapted to their liquid environment in various ways.