Question

Jacque solis, a 38-year-old, is leaving her current job and would like to take a long vacation before a new job. she has $58,000 in a qualified plan that she would like to live on during this period. if she is in a 25 percent marginal tax bracket, how much will she have left after paying taxes and penalties?

Answer 1

Jacque Solis will have $37,700 left after paying taxes and penalties from her $58,000 qualified plan during the said period. A qualified plan is an employer-sponsored retirement plan that qualifies for special tax treatment under Section 401(a) of the Internal Revenue Code.