Mit, who turned 70 1/2 on June 10th of Year 2, owns 32% of Big Company and is its current CEO. he has amassed $15 million in his qualified plan account as of December 31 of Year 1 and $17 million as of December 31 of Year 2. He has named his grandson Collin (age 9 at the end of Year 2) as his beneficiary. a. What is the minimum distribution that Mit must receive for Year 2? b. If he only receives a distribution of $200,000 during the current year, then how much in penalties will he be required to pay for Year 2? c. Assume that the market crashes in Year 3 and the value of the qualified plan drops to $1 million. As a result of the market drop, Mit dies in September of Year 3 and Colin inherits the IRA. If the value of the IRA is $1 million at the end of Year 3, $1.2 million at the end of Year 4, and $1.5 million at the end of Year 5, how much, if any, must Colin take out to satisfy the minimum distribution in Years 3, 4, and 5? d. Can Mit delay taking minimum distributions from his Big Company Plan since he is still employed? Explain why or why not. Mit, who turned 70 1/2 on June 10th of Year 2, owns 32% of Big Company and is its current CEO. he has amassed $15 million in his qualified plan account as of December 31 of Year 1 and $17 million as of December 31 of Year 2. He has named his grandson Collin (age 9 at the end of Year 2) as his beneficiary. a. What is the minimum distribution that Mit must receive for Year 2? b. If he only receives a distribution of $200,000 during the current year, then how much in penalties will he be required to pay for Year 2? c. Assume that the market crashes in Year 3 and the value of the qualified plan drops to $1 million. As a result of the market drop, Mit dies in September of Year 3 and Colin inherits the IRA. If the value of the IRA is $1 million at the end of Year 3, $1.2 million at the end of Year 4, and $1.5 million at the end of Year 5, how much, if any, must Colin take out to satisfy the minimum distribution in Years 3, 4, and 5? d. Can Mit delay taking minimum distributions from his Big Company Plan since he is still employed? Explain why or why not
