Annuities

c.they are not included as income for the employee but are taxable upon distribution

How are contributions to a tax sheltered annuity treated with regards to taxation? a.they are taxable as income for the employee. b.they are taxed as income for the employee but are tax free upon withdrawal. c.they are not included as income for the employee but are taxable upon distribution. d.they are never taxed.

d.the cash value will be paid to the annuitants estate

The annuity owner dies during the accumulation period without naming a beneficiary. Annuity's cash value exceeds premiums paid. Which of the following is TRUE? a.the premium value will be paid to the annuitants estate. b.all benefits will be forfeited. c.the cash value will be paid to the state government. d.the cash value will be paid to the annuitants estate.

c.the insurance company's general account.

When a fixed annuity owner pays a monthly annuity premium to the insurance company where is this money placed? a.each contracts separate account. b.the annuity owners account. c.the insurance company's general account. d.forwarded to an investor.

a.it would not occur in a deferred annuity

Which of the following is NOT true regarding the accumulation period of an annuity? a.it would not occur in a deferred annuity b.it is the period during which the annuity payments earn interest. c.it is the period over which the owner makes payments into an annuity. d.it is also known as the pay in period.

d.married couples are required to purchase a jointly owned IRA.

Which of the following statements is INCORRECT regarding IRAs? a.a non working spouse is eligible to contribute to a separate IRA account. b.anyone with earned income may open a traditional IRA. c.accumulated contributions grow tax deferred. d.married couples are required to purchase a jointly owned IRA.

c.earned income

what qualifies an individual to contribute to an IRA? a.investment income b.retirement income c.earned income d.any income

d.an individual who has earned income

who can make a fully deductible contribution to a traditional IRA? a.anybody all IRA contributions are fully deductible regardless of income level. b.someone making contributions to an educational IRA. c.a person whose contributions are funded by a return on investment. d.an individual who has earned income.

d.joint and survivor

A couple near retirement is planning for their golden years. They want to make sure that their retirement annuity provides monthly benefits for the rest of their lives. Should one of them die the other would still like to continue receiving benefits. Which settlement option should they choose? a. joint life b.life with period certain. c.straight life d.joint and survivor

c.immediate annuity

A lucky individual won the state lottery so the state will be sending him a check each month for the next 25 years?What type of annuity products are they likely to use to provide these benefits a.flexible payment annuity b.deferred interest annuity c.immediate annuity d.variable annuity

a.unemployment benefits

As it pertains to IRA eligibility which of the following would NOT be considered earned income? a.unemployment benefits b.wages for a part time job c.commissions d.an annual salary

d.the annuitants estate.

If a beneficiary is NOT named for annuity benefits to which entity will the benefit be paid? a.the next of kin. b.the state government. c.the insurance company. d.the annuitants estate.

c.the annuitant must be a natural person

The president of a company is starting an annuity and decides that his corporation will be the annuitant. Which of the following statements is true? a.a corporation can be an annuitant as long as the beneficiary is a natural person. b.the contract can be issued without an annuitant. c.the annuitant must be a natural person. d.a corporation can be an annuitant as long as it is also the owner.