Comprehensive and Detailed Step by Step Explanation:
Premature distributions from an IRA (withdrawals before age 59½) are subject to a10% penalty tax (B)unless certain exceptions apply (e.g., disability, qualified education expenses, or first-time homebuyer withdrawals).
5% (A):Does not apply to IRS penalties.
10% (B):Correct. This is the standard penalty for early withdrawals.
20% (C):Represents mandatory withholding for certain distributions, not the penalty.
50% (D):Applies only to Required Minimum Distribution (RMD) failures, not premature distributions.
[References:IRS Publication 590-B, Maryland IRA Penalty Exceptions Guidelines, COMAR 31.09.11., ]
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