Question

Irma. yes Michael Maria. yes Mark for follow up Jestion 3 of 41. 2015, Janelle converted $10,000 from her traditional IRA to a Roth IRA. In 2018, Janelle, then age 47, took a stribution from the Roth IRA. The value of the Roth IRA at the time was $11,000. What is the tax treatment o stribution? None of the distribution is included in income, BUT there is a 10% tax penalty on the entire distribution. The distribution is NOT included in income and there is NO penalty. Only the $1,000 in earnings is included in income, AND there is a 10% penalty on the earnings distribution. Only the $1,000 in earnings is included in income, but there is NO penalty on the earnings distribution. Mark for follow up stion 4 of 41. a received a lump-sum social security payment in 2018 that was for an earlier year. How would sh lection? dra needs to amend all prior tax returns impacted by the election.

Answer 1

The correct answer is (c) because

Your Roth IRA withdrawals may be taxable if:

• You’ve not met the 5-year rule for opening the Roth and you are under age 59 1/2: You will pay income taxes and a 10% penalty tax on earnings that you withdraw.