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Max Retired in 2015 at Age 62

question 98

Multiple Choice

Max retired in 2015 at age 62. During the year he received distributions of $9,000 from his IRA. He made nondeductible contributions of $20,000 to the IRA in prior years and has never received a nontaxable distribution. As of December 31, 2015, the value of his IRA was $150,000. Calculate the taxable portion of Max's distribution.


Definitions:

Mental Capacity

The ability of an individual to make informed decisions and understand the consequences of those decisions.

Intoxicated

A condition of being under the influence of alcohol or drugs to a degree that impairs a person's physical and cognitive functions.

Void

A void agreement or contract has no legal effect, thus it's as if it never existed due to illegality or impossibility.

Standard of Living

The degree of wealth, comfort, material goods, and necessities available to a person, community, or nation.

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