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ITEM SET 2: RETIREMENT PLAN DISTRIBUTIONS Chad Boudreaux is a 58-year-old riverboat captain. He grew up in New Orleans and has worked on the Mississippi
ITEM SET 2: RETIREMENT PLAN DISTRIBUTIONS Chad Boudreaux is a 58-year-old riverboat captain. He grew up in New Orleans and has worked on the Mississippi River his entire life. He works for a private company in New Orleans called Crescent River Pilots Inc. (CRP) and is married to Patricia, who is 35 years old. They have a seven-year-old son, named River. CRP sponsors a 401(k) plan that offers a Roth account and a separate ESOP. Chad has the following retirement plan accounts: Account Description Current FMV Beneficiary ESOP account from CRP consists of CRP shares. The cost basis for $400,000 Patricia the shares is $75,000. 401(k) Plan From CRP Inc. $800,000 Patricia 401(k) Plan from Schlumberger, where he worked in his thirties Roth IRA (established in 2000 with a $2,000 initial contribution; three years ago he converted a traditional IRA with a balance of $10,000) $90,000 Patricia $45,000 Patricia Traditional IRA (established twenty years ago with $15,000 of after- tax contributions) $90,000 River Inherited IRA from the death of his mom. She died in the same year Chad turned 50 years old. $120,000 River 1. Chad plans on retiring in March of this year, and he and his wife would like to go to Rome for an extended vacation. He wants to take a distribution of $20,000 from one of his retirement accounts to pay for the vacation. Which of his retirement plans would allow him to take a penalty-free with- drawal to fund his vacation
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