Final answer:
The amount of Essie's distribution from the Roth 401(k) plan subject to the 10% early withdrawal penalty is $15,000. Option (D) is correct.
Step-by-step explanation:
Qualified distributions are tax-free and penalty-free. As far as the IRS is concerned, a Roth IRA distribution is considered qualified if your account meets the five-year rule and the withdrawal is: Made on or after the date you turn 59½ Taken because you have a permanent disability.
Contributions and earnings in a Roth 401(k) can be withdrawn without paying taxes and penalties if you are at least 59½ and had your account for at least five years. Withdrawals can be made without penalty if you become disabled or by a beneficiary after your death.
The distribution from Essie's Roth 401(k) plan that is subject to the 10% early withdrawal penalty can be calculated by multiplying the penalty rate by the distribution amount. In this case, since we don't have the distribution amount, we can't calculate the exact penalty amount. However, if Essie has withdrawn the entire account balance of $15,000, then the penalty amount would be $15,000 multiplied by 10%, which is $1,500.
Therefore, the answer would be option D, $15,000.