Series 7 - General Securities Representative Exam

Preview Mode

An investor that takes a an early withdrawal of contributions from a Roth IRA at age 46 is subject to

A 10% premature distribution penalty
A
A 10% premature distribution penalty and income tax
B
No tax or penalty implications
C
Ordinary income tax
D

Explanations

There are no taxes or penalties on early withdrawal of contributions from Roth IRAs. The taxes have already been paid. The key word here is contributions, as earnings may be subject to tax or penalty

Pricing