Which Of The Following Would Disqualify A Company'S Retirement Plan
Question: Which of the following is NOT a federal requirement of a qualified plan?
Must benefit a broad cross-section of employees
B. Employee must be able to make unlimited contributions
C. Vesting schedule must be defined
D. Employer establishes the plan
Answer: Employee must be able to make unlimited contributions
Question: Which of the following employers is required to follow ERISA regulations?
A. A local government with 150 employees
B. A church with 30 employees
C. A local electrical supply company with 12 employees
D. A Canadian company with 300 employees working in the United States
Answer: A local electrical supply company with 12 employees
Question: An example of a tax-qualified retirement plan would be a(n)
A. equity compensation plan
B. defined contribution plan
C. executive index plan
D. 1035 exchange plan
Answer: defined contribution plan
Question: Mike has inherited his father’s traditional IRA. As beneficiary, he will pay ____ taxes on any money withdrawn.
A. estate
B. probate
C. no
D. income
Answer: income
Question: A Roth IRA owner must be at least what age in order to make tax-free withdrawals?
A. 59 1/2 and owned account for a minimum of 10 years
B. 59 1/2 and owned account for a minimum of 5 years
C. 70 1/2 and owned account for a minimum of 10 years
D. 70 1/2 and owned account for a minimum of 5 years
Answer: 59 1/2 and owned account for a minimum of 5 years
Question: Which of the following would disqualify a company’s retirement plan from receiving favorable tax treatment?
A. Contains a vesting schedule
B. Contributions are applied with no regard to income
C. Formed for the sole benefit of employees and their beneficiaries
D. It is temporary
Answer: It is temporary
Question: When a qualified plan starts making payments to its recipient, which portion of the distributions is taxable?
A. Principal
B. Contributions made by employee
C. Contributions made by employer
D. Gains
Answer: Gains
Question: Within how many days must a rollover be completed in order to avoid being taxed as current income?
A. 30
B. 60
C. 90
D. 120
Answer: 60
Question: Under a Traditional IRA, interest earned is taxed?
A. only if withdrawn prior to age 59 1/2
B. according to the capital gains rate
C. upon distribution
D. during the accumulation phase
Answer: Upon distribution
Question: Who were Keogh plans designed to provide pension benefits for?
A. Corporate officers
B. Public school employees
C. The self-employed
D. Government employees
Answer: The self-employed