Problem:
On April 30, Janet, age 42, received a distribution from her qualified plan of $150,000. She had an adjusted basis in the plan of $500,000 and the fair market value of the account as of April 30 was $625,000. Calculate the taxable amount of the distribution and any applicable penalty.
A. $30,000 taxable, $3,000 tax penalty
B. $30,000 taxable, $0 tax penalty
C. $120,000 taxable, $12,000 tax penalty
D. $150,000 taxable, $15,000 tax penalty