In 2016, Jessica Retired at the Age of 65

question 61

Multiple Choice

In 2016, Jessica retired at the age of 65. The current balance in her traditional IRA was $200,000. Over the years, Jessica had made $20,000 of nondeductible contributions and $60,000 of deductible contributions to the account. If Jessica receives a $50,000 distribution from the IRA, what amount of the distribution is taxable?

• A) $0
• B) $5,000
• C) $37,500
• D) $45,000
• E) $50,000

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Definitions:

Muscles

Tissues in the body that can contract, enabling movement and support of bodily functions.

Capillaries

Small, thin-walled blood vessels that connect arteries and veins, where oxygen, nutrients, and wastes are exchanged between the blood and tissues.

Oxygen-Deficient Blood

Blood that carries less oxygen than normal, often as a result of respiratory or circulatory problems.

Carbon Dioxide

A colorless, odorless gas produced by burning carbon and organic compounds and by respiration, absorbed by plants in photosynthesis.