Myra Retired Last Year from Whiplash Company After Working There

Multiple Choice

Myra retired last year from Whiplash Company after working there for 30 years. She elects to take her retirement benefits in the form of a lifetime annuity. Her retirement balance consists of $40,000 of employer contributions, $80,000 of her before-tax contributions, $20,000 of her after-tax contributions, and $60,000 of investment income. The plan will pay her $1,500 per month based on her life expectancy of 22 years. In 2017, Myra receives twelve $1,500 payments. What is her taxable income?

A) $18,000
B) $17,091
C) $14,364
D) $13,455