Question

Max retired in 2017 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, 2017, the value of his IRA was $150,000. Calculate the taxable portion of Max's distribution. Show Work

Answer #1

When there are non-deductible contributions in the traditional IRA, distributions from the account are not taxable as a percentage. Percentage applicable is non-deductible contributions made divided by IRA balance before distribution.

Non taxable Percentage applicable = 20,000/ 150,000 * 100 = 13.3333%

Taxable percentage = 1- 13.3333% = 86.66667%

Taxable distribution = 9,000 * 86.66667% = 7,800

Non taxable distribution = 9,000 * 13.3333% = 1,200

After the distribution balance non-taxable contributions in the IRA reduces to = 20,000 - 1,200 = 18,800

Terrance is age 71 and retired. Beginning in 2017, he must start
taking minimum distributions from his IRA account that had a
balance of $150,000 as of December 31,2016. Make these theee
assumptions: His IRA will earn 8% per year, he will withdraw the
minimum distribution in the last day of each calendar year, and
only one distribution will be take. In 2017. Calculate the amount
of his distribution for years 2017 through 2021 and the ending
balance in his...

In 2019, Rashaun (62 years old) retired and planned on
immediately receiving distributions (making withdrawals) from his
traditional IRA account. The balance of his IRA account is $160,000
(before reducing it for withdrawals/distributions described below).
Over the years, Rashaun has contributed $40,000 to the IRA. Of his
$40,000 contributions, $30,000 was nondeductible and
$10,000 was deductible. Assume Rashaun did not make any
contributions to the account during 2019. (Do not round
intermediate calculations. Round your final answers to the nearest...

Rashaun (62 years old) retired and
planned on immediately receiving distributions (making withdrawals)
from his traditional IRA account. The current balance of his IRA
account is $165,851. Over the years, Rashaun has contributed to the
IRA. Of his contributions, $40,100 was nondeductible and
$11,300 was deductible.
If Rashaun currently withdraws $29,800
from the IRA, how much of the distribution is nontaxable?
Please explain how you got each number
in your solution and/or where the number comes from.

. In 2018, Max is 85 years of age and single.
He received Social Security payments totaling $14,000 (this
includes Medicare premium of $600), dividend and interest income of
$21,000, a pension of $30,000 and a taxable IRA benefits of
$16,000. What is Max's adjusted gross income for 2018? What is his
taxable income? What is his tax owed?

Rick, a retired single taxpayer, began receiving a
monthly pension from his former employer in January 2016. He was
age 66 when he received the first payment, and the pension will pay
over the course of his life. He received a Form 1099-R for the tax
year showing a gross distribution of $8,000 in box 1, code 7 in box
7, and total employee contributions of $20,000 in box 9b. Box 2a is
blank, and box 2b indicates that the...

Solve the following scenario below:
+ Quentin attained age 70 1/2 on August 7, this year.
+ The balance in Quentin's mutual fund IRA on December 31, last
year,is $45,000.
+ The balance in Quentin's bank IRA on December 31, last year,is
$20,000.
+ Quentin wants to take a distribution from his IRA to satisfy
the minimum distribution requirement.
+ Elizabeth, his wife, is age 65 and is the beneficiary on both
of Quentin's IRAs.
Which of the following are...

Question 1 (1 point)
Ray died this year at age 73, and his wife, Mary, age 55, is the
designated beneficiary on his Roth IRA. Ray's Roth IRA was
established 3 years ago. Which of the following statements is(are)
CORRECT?
I Ray was not subject to required minimum distributions from his
Roth IRA during his lifetime.
II If Mary chooses to distribute the entire balance of the Roth IRA
this year, the distribution may be subject to both regular income...

James and Molly are married couples, both 62 years old and both
retired from their respective companies last year. Both James and
Molly rolled their employer retirement accounts over into
self-directed individual retirement accounts. James is starting
withdrawals from his account this year. They are planning to hold
off on withdrawals from Molly's account until the required age of
701/2. Their daughter jane has a child, a three year-old named
Nancy. Molly and her husband are in the 25% tax...

2 . Identify which of the following statements is true:
If an S Corporation has no accumulated earnings and profits, the
amount distributed to a shareholder will not increase the
shareholder's basis in the stock
If a C Corporation does not distribute its income to its
shareholders, double taxation of the income will occur.
C Corporation operating losses are deductible by the individual
shareholders
S Corporation operating losses are never deductible by the
individual...

1) On January 1, 2014, Bullitt Corporation sold a machine to
Sting Corporation and simultaneously leased it back for ten
years.
The following information is available regarding the lease:
Estimated remaining useful life at December 31, 2013
10 years Sales price $ ,90,000 Carrying value at December 31,
2103
$ 52,500 Annual rental under leaseback
$14,600 Interest rate implicit in the lease 10%
Present value of the lease rentals $ 89,711 (14,600 for 10 years
at 10%) How much profit...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 3 minutes ago

asked 3 minutes ago

asked 3 minutes ago

asked 3 minutes ago

asked 6 minutes ago

asked 6 minutes ago

asked 7 minutes ago

asked 9 minutes ago

asked 10 minutes ago

asked 10 minutes ago

asked 11 minutes ago

asked 12 minutes ago