How much tax will Alonzo have to pay on his IRA withdrawal?

Based on the given data, how much tax will Alonzo have to pay when he withdraws the entire $9900 from his traditional IRA?

What is the tax bracket Alonzo is currently in?

Answer:

Alonzo will have to pay $2475 in taxes on his IRA withdrawal.

Alonzo deposited $4800 into a traditional IRA, which grew to $9900 at his retirement. Now, at 75 years old and in the 25% tax bracket, Alonzo will have to pay $2475 in taxes when he withdraws the entire $9900 from his traditional IRA.

This tax amount is calculated by multiplying the withdrawal amount of $9900 by the tax rate of 25%, resulting in $2475 that Alonzo must pay in taxes.

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