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1.
For which of the following situations would the 10 percent early withdrawal penalty apply to Roth IRA earnings withdrawals?
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Purchase of a new car. The Roth IRA does not allow this.
2.
Which of the following may not be used to hold a Roth IRA?
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A collection of rare stamps. Collectibles are not allowed as Roth IRA investments.
3.
Lisa, age 35, received $85,000 from her Roth IRA with the intent of rolling it over into a new fund. The actual amount she rolled over was $80,000. As a result, she will ______.
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Be charged a penalty tax. To avoid any penalty, the new IRA must open with the same amount of money that was in the rollover.
4.
You are required to take Roth IRA withdrawals _______.
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Not at all. You are not required to take distributions from a Roth IRA during your lifetime.
5.
If you are single and you have a traditional IRA account, you are not allowed to have a Roth IRA as well.
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False. You may indeed have both, as long as the total contributions each year do not exceed the maximum allowed.