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A recent high school principal retiree is receiving money monthly from his pension. At the earliest, when will he need to make a withdrawal from his deferred compensation account and report it as taxable income?
When he turns 65
When he turns 70.5
When he turns 72
There is no specified age
The correct answer is: When he turns 72
The reason why options A, B, and D are incorrect is because they do not match up with the current laws regarding required minimum distributions (RMDs) from deferred compensation accounts. As of 2021, the age for taking RMDs from a deferred compensation account is 72, not 65, 70.5, or any other age. Additionally, the fact that the individual is retired and receiving monthly pension payments does not exempt them from having to take RMDs from their deferred compensation account. Therefore, option C is the correct answer as it aligns with the current laws and regulations.