Question

Mindy has a Roth IRA held longer than 5 years to which she has contributed $30,000. The IRA has a current value of $62,000. Mindy is 55 years old and she takes a distribution of $38,000 after retiring on disability. How much of the distribution will be taxable to Mindy?

Answer 1

Answer:

The correct answer is zero.

Explanation:

Mindy has held the IRA for more than 5 years.  

She has contributed $30,000.  

The current value of the IRA is $62,000.  

After retiring Mindy takes a distribution of $38,000.

The taxable amount is zero. This is because taxpayers can make withdrawals from Roth IRA if they become disabled.

So, the correct answer is zero.