Qualified Plans quiz study set

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

Roth IRA

WHich of the following statements concerning a Simplified Employee Pension plan (SEP) is INCORRECT?

SEPs are suitable for large companies

If a company has a Simplified Employee Pension plan, what type of plan is it?

a qualified plan for a small business

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

A tax-sheltered annuity is a special tax-favored retirement plan available to

certain groups of employees only

all of the following are true regarding tax-qualified annuities EXCEPT

employer contributions are not tax deductible

Which of the following is true of a qualified plan?

it has a tax benefit for both employer and employee

All of the following types of distributions are considered exceptions to the early distribution rule and, therefore, are not subject to the penalty tax EXCEPT

participant's debt

All of the following would be different between qualified and nonqualified retirement plans EXCEPT

taxation on accumulation

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

Under a SIMPLE plan, which of the following is TRUE regarding taxation on both contributions and earnings?

they are tax deferred until withdrawn