Question

I appreciate your explanation. I found different answers on these questions and it can be confusing.

7. For a beneficiary to receive a qualified distribution from a Roth IRA, who must meet the five-year requirement?
A. The beneficiary, after taking distributions.
B. Both the owner and the beneficiary.
C. Either the owner or the beneficiary, before taking distributions.

8. Which statement about the American Opportunity Tax Credit and the lifetime learning credit is FALSE?
A. A portion of the American Opportunity Tax Credit is a refundable credit.
B. An eligible individual for the lifetime learning credit may be enrolled part-time.
C. Only four-year universities are eligible institutions for the American Opportunity Tax Credit and the lifetime learning credit.

Answer 1

Answer (1)

Option -C is correct

For distribution from Roth IRA to be qualified,it must have completed atleast 5 years after the owner of Roth IRA established the fund.

But,if the owner is died before completeing the 5 years period,the beneficiary have to wait to complete the 5 year period before taking distribution from the Roth IRA

Answer (2)

Option - C is FALSE

The statement "Only four year univerisities are eligible institutions for the American Opportunity Tax credit and the Life Time Learning credit" is false

American opportinity tax credit is a tax credit allowable for a qualified educational expense for a student for the first four years of the post secondary education for American tax payers

Whereas Life Time Learning Credit is allowable to students who are enrolled in an eligible educational institution.This credit is allowable for undergraduate,graduate and professional degress.There is no time limit or number of years limit to claim the credit