An Individual Working Part Time

Question: In an individual retirement account (IRA), rollover contributions are

-subject to capital gains tax

-subject to ordinary income tax

-partially limited by dollar amount

-not limited by dollar amount

Answer: Not limited by dollar amount

Question: What is the maximum number of employees (earning at least 5,000) that an employer can have in order to start a simple retirement plan?

-25

-50

-100

-250

Answer: 100

Question: Which plan is intended to be used by a sole proprietor and the employees of that business?

-SEP Plan

-Keogh Plan

-Individual Retirement Account (IRA)

-SIMPLE Plan

Answer: Keogh Plan

Question: 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?

-no deduction allowed

-$25,000

-$20,000

-$10,000

Answer: $25,000

Question: An employer that offers a qualified retirement plan to its employees is eligible to

-avoid ERISA regulations

-make tax-deductible contributions to the plan

-make tax-deductible contributions to key employees only

-make partial tax-deductible contributions to the plan

Answer: Make tax-deductible contributions to the plan

Question: What type of employee welfare plans are not subject to ERISA regulations?

-church plans

-major medical plans

-corporate

-qualified plans

Answer: Church plans

Question:

Answer: Income tax and a 10% penalty assessed upon funds withdrawn from the Qualified Plan

Question: Premature IRA distributions are assessed a penalty tax of

-0&

-10%

-15%

-20%

Answer: 10%

Question: How are Roth IRA distributions normally taxed?

-10% penalty tax is applied

-taxed as ordinary income

-capital gains tax is applied

-distributions are received tax-free

Answer: Distributions are received tax-free

Question: In a qualified retirement plan, the yearly contributions to an employee’s account

-are not tax-deductible

-are restricted to minimum levels set by the IRS

-are restricted to maximum levels set by the IRS

-must be matched dollar-for-dollar by the employer

Answer: Are restricted to maximum levels set by the IRS