Chapter 9 Retirement Plans
How long does an individual have to "rollover" funds from an IRA or qualified plan?
60 days
An individual working part-time has an annual income of $25,000. If this individual has an IRA, what is the maximum deductible IRA contribution allowable?
$2,500 (10%)
An individual participant personally received eligible rollover funds from a profit-sharing plan. What is the income tax withholding requirements for this transaction?
20%
Who is normally considered to be the owner of a 403(b) tax-sheltered annuity?
Employee
Which of these retirement plans can be started by an employee, even if another plan is in existence?
IRA
Tom has a qualified retirement plan with his employer that is currently considered to be 80% "vested". How can this be interpreted?
If Tom's employment is terminated, 20% of the funds would be forfeited
At the age of 45, an individual withdraws $50,000 from his Qualified Profit-Sharing Plan and then deposits this amount into a personal savings account. This action would result in:
Income tax and a 10% penalty assessed upon funds withdrawn from the Qualified Plan
A 55 year old recently received a $30,000 distribution from a previous employer's 401k plan, minus $6,000 withholding. Which federal taxes apply if none of the funds were rolled over?
Income taxes plus a 10% penalty tax on $30,000
A retirement plan that sets aside part of the company's net income for distributions to qualified employees is called a:
profit-sharing plan
An IRA owner can start making withdrawals and NOT be subjected to a tax penalty beginning at what age?
59 1/2