hard · Certified Financial Planner Tax Planning

A client in the 37% bracket has $100,000 of Net Unrealized Appreciation (NUA) inside a company 401(k). The cost basis of the stock is $25,000.

If the client takes an NUA distribution, what is the immediate tax on the cost basis?

  1. $0
  2. $3,750
  3. $37,000
  4. $9,250

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