chapter 7 quiz
the advantage of qualified plans to employers is
tax-deductible contributions
a tax-sheltered annuity is a special tax-favored retirement plan available to
certain groups of employees only
all of the following apply to defined benefit plans except
contributions are tied to the company profits
under a defined benefit retirement plan, who determines what benefits a retied employee will receive
employer
which of the following is not true regarding a nonqualified retirement plan
it needs IRS approval
all of the following statements are true regarding tax-qualified annuities EXCEPT
employer contributions are not tax deductible
under the 401(K) bonus or thrift plan, the employer will contribute
an undetermined percentage for each dollar contributed by the employee
an employer has sponsored a qualified retirement plan for its employees where the employer will contribute money whenever a profit is realized. what is this called
profit sharing plan
if a retirement plan or annuity is "qualified," this means
it is approved by the IRS
for a retirement plan to be qualified, it must be designed for the benefit of
employees
a 35-year-old spouse of the insured collects early distributions from her husband's retirement plan as a result of a divorce settlement. what penalties, if any, will she have to pay
no penalties
a 403(b) plan, commonly referred to as a TSA, is available to be used by
teachers and not-for-profit organizations
all of the following would be different between qualified and nonqualified retirement plans EXCEPT
taxation on accumulation
an internal revenue code provision that specifically provides for an individual retirement plan for public school teachers is a(n)
403(b)plan (TSA)
which of the following statements concerning a simplified employee pension plan (SEP) is incorrect?
SEPs are suitable for large companies
all of the following are general requirements of a qualified plan EXCEPT
the plan must provide an offset for social security benefits
which of the following describes the tax advantage of a qualified retirement plan
the earnings in the plan accumulate tax deferred
two attorneys operate their practice as a partnership. they want to start a program through their practice that will provide retirement benefits for themselves and three employees. they would likely choose
HR-10 (keogh plan)
which type of retirement account does not require the owner to start taking distributions at age 72
Roth IRA
who may contribute to a Keogh (HR-10) plan
self employed plumber
in a defined contribution plan,
the contribution is known and the benefit is unknown
all of the following employees may use a 403(b) plan for their retirement except
the CEO of a private corporation
under a SIMPLE plan, which of the following is true regarding taxation on both contributions and earnings
they are tax deferred until withdrawn
employer contributions made to a qualified plan
are subject to vesting requirements
what is the primary purpose of a 401(k) plan
retirement
SIMPLE plans require all of the following EXCEPT
at least 1,000 employees
which of the following scenarios will incur a 10% tax penalty on distributions
distributions are made on a policy before the age 59 1/2
all of the following are true of the federal tax advantages of a qualified plan except
at distribution, all amounts received by the employee are tax free.
an IRA purchased by a small employer to cover employees is known as a
simplified employee pension plan
which of the following characteristics applies to defined benefit plans but not defined contribution plans
the amount of contributions made by the employer is determined by an actuarial formula
