Qualified Plans

Under the 401(k) bonus or thrift plan, the employer will contribute..?

An undetermined percentage for each dollar contributed by the employee.

Employer contributions made to a qualified plan..

Are subject to vesting requirements. Qualified plans must have a vesting requirement.

Tax Qualified Annuities

are required to be approved by the IRS, provide tax deductible employer contributions. All withdrawals are taxed wnd earrnings grow tax deffered.

Keogh Plans (HR-10)

self-employed person or a partner working part time or full time who owns more than 10% of the business

Under a defined benefit retirement plan, who determines what benefits a retired employee will receive?

the Employer.

How are contributions to a tax-sheltered annuity treated with regards to taxation?

They are not included as income for the employee, but are taxable upon distribution.

Which type of retirement account does not require the owner to start taking distributions at age 72?

Roth IRA.

The advantage of qualified plans to employers is..?

Tax-deductible contributions. Qualified plans have these tax advantages: Employer contributions are tax deductible and are not taxed as income to the employee; the earnings in the plan accumulate tax deferred; lump sum distributions to employees are eligible for favorable tax treatment.

Simplified Employee Pension (SEP)

Tax-deferred account to which the self-employed and employees of very small businesses can contribute.

What is a tax advantage of a qualified retirement plan?

The earnings in the plan accumulate tax deferred.

Profit Sharing Plan

Where the employer will contribute monies into an employees retirement plan when the company shows a profit.

403(b) Plan

a tax-deferred retirement plan for employees of certain nonprofit organizations and employees of public school systems.