Max retired in 2018 at age 62. During the year he received distributions of $9,000 from his IRA. He made nondeductible contributions of $20,000 to the IRA in prior years and has never received a nontaxable distribution. As of December 31, 2018, the value of his IRA was $150,000. Calculate the taxable portion of Max's distribution.
A. $1,132.
B. $7,868.
C. $9,000.
D. $0.
Answer: B
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