McGraw-Hill's Taxation of Individuals and Business Entities 3rd Edition by Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver

Exercise 16

Jimmer has contributed $15,000 to his Roth IRA and the balance in the account is $18,000.In the current year, Jimmer withdrew $17,000 from the Roth IRA to pay for a new car.If Jimmer's marginal ordinary income tax rate is 25 percent, what amount of tax and penalty, if any, is Jimmer required to pay on the withdrawal in each of the following alternative situations?
a.Jimmer opened the Roth account 44 months before he withdrew the $17,000 and Jimmer is 62 years of age.b.Jimmer opened the Roth account 44 months before he withdrew the $17,000 and Jimmer is age 53.c.Jimmer opened the Roth account 76 months before he withdrew the $17,000 and Jimmer is age 62.d.Jimmer opened the Roth account 76 months before he withdrew the $17,000 and Jimmer is age 53.