Mrs. Lee, age 70, withdrew $10,000 from her Roth IRA this year. Mrs. Lee opened this account in 2000. The balance in the account at year-end was $76,600, which included $50,000 of contributions. Compute the taxable portion of the $10,000 withdrawal.

Question

Quizplus · Accepted Answer

Since Mrs. Lee withdrew from a Roth IRA account, there is no taxable portion of the withdrawal. All contributions made to a Roth IRA account have already been taxed, so withdrawals from a Roth IRA are tax-free.

Mrs Lee, Age 70, Withdrew $10,000 from Her Roth IRA