Question

Terrance is age 71 and retired. Beginning in 2018, he must start taking minimum distributions from his IRA account that had a balance of $195,000 as of December 31, 2017. Make these three assumptions: his IRA will earn 10% per year; he will withdraw the minimum distribution on the last day of each calendar year, and only one distribution will be taken in 2018. Calculate the amount of his distribution for years 2018 through 2022 and the ending balance in his IRA account on December 31, 2022. Use Table 1. Table III and Table V. (Do not round "Applicable Life Expectancy" answers. Round other answers to nearest whole dollar value. Use these answers in subsequent computations.) (3) Year (1) IRA Balance At End of Prior Year (2) Applicable Life Expectancy Required EIRA Earnings Distribution (5) Ending Balance 2018 2019 2020 2021 2022

Answer 1

Year	IRA balance at end of prior year (1)	Applicable life expectancy (2)	Required distribution (1/2)	IRA earnings @ 10% (1*10%)	Ending balance
2018	$                                        195,000	26.5	$                             7,358	$                                19,500	$        207,142
2019	$                                        207,142	25.6	$                             8,091	$                                20,714	$        219,764
2020	$                                        219,764	24.7	$                             8,897	$                                21,976	$        232,843
2021	$                                        232,843	23.8	$                             9,783	$                                23,284	$        246,344
2022	$                                        246,344	22.9	$                           10,757	$                                24,634	$        260,221