17
QuizMultiple Choice

Individual Retirement Plans — Quiz

Question 17 • Financial Math

A 52 -year-old individual nearing retirement withdraws $⁢20,000 from their traditional IRA to pay for a first-time home purchase. What are the taxes and penalties on this withdrawal?

Answer
A
2 dollars comma 000 penalty and taxed as ordinary income
B
1 dollars comma 000 penalty and taxed as ordinary income
C
no penalty and taxed as ordinary income
D
no penalty and no taxes
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