CRPC YOU GOT THIS STUDY CARDS - MEMORIZE AND BE
FAMILIAR WITH THESE AND YOU GOT THIS. FRIGGEN 110%
PASSING SCORE.
"Bridge jobs" describe periods of partial retirement for older workers. Which one of the following
statements regarding bridge jobs is not true?
They generally represent a move up the socioeconomic ladder, from less-skilled to more-skilled jobs.
They are less likely to include health insurance coverage.
They generally allow more flexibility than employees' previous full-time jobs. -- They generally
represent a move up the socioeconomic ladder, from less-skilled to more-skilled jobs.
Bridge jobs generally represent a move down the socioeconomic ladder, from more-skilled to less-skilled
jobs or from white-collar to blue-collar jobs. They are also likely to pay less and are less likely to offer
pension plans or health insurance coverage. On the other hand, due to their temporary or part-time
nature, bridge jobs generally allow more flexibility than full-time career positions.
-"Golden parachute" agreements may include all of the following, except
cash.
company stock.
medical and life insurance.
reduced pension benefits. -- reduced pension benefits.
Golden parachute agreements may include various combinations of cash, company stock, medical and
life insurance, extra pension benefits, and other benefits.
-2017 Earnings cap for singles? -- $16,920
-A Cash Flow statement is used to calculate what? And what does it have on it? -- Inflows and out flows.
Not assets and liabilities.
-A direct rollover is a transaction in which benefits from a qualified plan are rolled over directly to
the individual with a check in their name.
a participant's checking or savings account.
another eligible retirement plan.
a conduit IRA. -- another eligible retirement plan.
A direct rollover may be accomplished by any reasonable means of direct payment to an eligible
retirement plan, including a wire transfer or mailing of a check negotiable only by the plan's trustee.
Using a conduit IRA is a means of an indirect rollover.
-A distribution cannot be made from a TSA until the employee does which of the following? --
Distributions can be made when an employee separates from service, attains age 591⁄2, becomes disabled
or dies, or qualifies under hardship rules.
,-A penalty is imposed for failing to take the required minimum distribution (RMD).
10%
20%
50%
100% -- 50%
The penalty for failing to take the RMD is 50% of the difference between what should have been taken
and what was taken.
-A power of attorney is an effective tool for incapacity planning if
it is a general power of attorney.
it is a durable power of attorney.
it is a springing power of attorney.
both b and c. -- both b and c.
A durable power of attorney continues after a principal's incapacity, and a springing power of attorney
becomes effective when the principal becomes incapacitated. The general power of attorney is not an
effective tool for incapacity planning for a simple reason: The agent's authority ceases when the
principal either dies or becomes incapacitated.
-A qualified plan must withhold 20% of any distribution that is
part of a trustee-to-trustee transfer.
rolled to a conduit IRA.
part of a lifetime annuity.
going to be rolled over to another qualified plan within 60-days. -- going to be rolled over to another
qualified plan within 60-days.
The 20% withholding rule does not apply to direct rollover distributions or trustee-to-trustee transfers;
the 20% withholding rule does apply to indirect rollover distributions, such as a 60-day rollover.
-A Roth IRA distribution is considered to be "qualified" if... -- ...a five-year holding period is met and the
distribution is made after the attainment of age 591⁄2, death, or disability, or if it is made for the purchase
of a first-time home (maximum $10,000).
-A standardized Medigap plan is designed to cover
long-term care expenses when treatment lasts longer than 100 days.
Medicare-approved charges that are not paid by Medicare.
charges that are considered nonmedical and are not covered by Medicare. -- Medicare-approved
charges that are not paid by Medicare.
Medigap insurance is designed to supplement Medicare's benefits by filling in some of what Medicare
does not cover, such as deductibles and coinsurance; it covers only Medicare-approved charges.
Standardized Medigap plans pay only for long-term care while the beneficiary qualifies for benefits from
Medicare, and is limited to paying the coinsurance from the 21st through 100th days.
,-A trustee-to-trustee transfer is an example of a
direct rollover.
indirect rollover.
conduit rollover.
60-day rollover. -- direct rollover.
A trustee-to-trustee transfer is an example of a direct rollover. A 60-day rollover would be an example of
an indirect rollover. A conduit IRA is used to shift assets from the qualified plan of one employer to the
qualified plan of another employer using the conduit IRA as an intermediate step.
-A worker's primary insurance amount (PIA) is the amount they receive from Social Security if... -- ...he
or she began payments at full retirement age.
-Active participation in what retirement plans for any part of a plan year ending within the individual's
taxable year may restrict his or her ability to deduct contributions to an IRA? -- a qualified pension, profit
sharing, stock bonus, money purchase, SIMPLE
401(k) plan, or Roth 401(k) plan;
a qualified plan established for employees by a federal, state, or local
government or their subdivisions, other than a Section 457 plan;
a tax-sheltered annuity plan (TSA) (also known as Section 403(b) plan) for
employees of public schools and certain tax-exempt organizations;
a simplified employee pension (SEP); or
a savings incentive match plan for employees (SIMPLE) IRA.
-Alicia has contributed $8,000 to a Roth IRA over the past four years. The account has grown to $10,000
with investment earnings. She is facing a financial bind and needs to withdraw $9,000. She will have to
pay income tax and a 10% penalty on
$1,000.
$8,000.
$9,000. -- $1,000.
Since the Roth contributions were made with after-tax dollars, Alicia can withdraw her contributions
first. She could withdraw the entire $8,000 that she has contributed without any tax or penalty. Only
$1,000 of her withdrawal will be subject to income tax or penalty.
-All of the following apply to voluntary early retirement programs except
they rarely result in lawsuits against the companies offering the programs.
they provide a set of incentives to reduce corporate headcount.
they present pluses and minuses for the eligible employee.
, they should be analyzed based on their future value. -- they should be analyzed based on their future
value.
Voluntary early retirement incentives provide a set of incentives to reduce corporate headcount. They
present pluses and minuses for the eligible employee that should be evaluated based on their net
present value. Such arrangements rarely result in lawsuits because employees select themselves for
termination.
-All of the following are characteristics of a Qualified Longevity Annuity Contracts (QLACs) except:
receipt of income payments is typically deferred until age 85.
the participant can elect either a fixed or variable annuity.
up to 25% of a qualified plan (or IRA) balance can be used to purchase a QLAC and be exempted from
RMD requirements.
they are a means of transferring longevity risk to an insurance company. -- the participant can elect
either a fixed or variable annuity.
QLAC's must be fixed (not variable) annuities. The other statements are true regarding QLAC's
-All of the following are disadvantages to performing an indirect rollover from a qualified plan to an
existing IRA except
the rollover must be completed within a 60-day period to avoid being taxed.
20% of the gross distribution will be withheld for taxes.
the entire distribution will be subject to immediate taxation. -- the entire distribution will be subject to
immediate taxation.
By rolling over assets to an existing IRA, the plan assets less the amount withheld escape immediate
taxation. Taxes are deferred until the participant begins withdrawing money. A mandatory 20%
withholding is imposed on a qualified plan distribution if the plan issues a check to the participant.
Finally, if an indirect rollover is not completed within 60-days the full distribution amount will be taxed.
-All of the following are true about the deductibles that apply to health insurance except
health insurance deductibles apply per incident.
a deductible is the amount that the insured must pay before the plan pays anything.
the deductible for Catastrophic and Bronze plans will be larger than for Gold or Platinum plans.
deductibles do not apply to many forms of preventive care. -- health insurance deductibles apply per
incident.
Unlike a homeowners or automobile policy, a health insurance deductible is an annual amount, not a
per incident amount. Preventive care and wellness benefits, such as mammograms and well-baby care,
are often paid 100% by the insurance company without a required deductible.
-All of the following are true regarding COBRA-mandated continuation of group medical coverage for
terminated employees except
proof of insurability is required.
FAMILIAR WITH THESE AND YOU GOT THIS. FRIGGEN 110%
PASSING SCORE.
"Bridge jobs" describe periods of partial retirement for older workers. Which one of the following
statements regarding bridge jobs is not true?
They generally represent a move up the socioeconomic ladder, from less-skilled to more-skilled jobs.
They are less likely to include health insurance coverage.
They generally allow more flexibility than employees' previous full-time jobs. -- They generally
represent a move up the socioeconomic ladder, from less-skilled to more-skilled jobs.
Bridge jobs generally represent a move down the socioeconomic ladder, from more-skilled to less-skilled
jobs or from white-collar to blue-collar jobs. They are also likely to pay less and are less likely to offer
pension plans or health insurance coverage. On the other hand, due to their temporary or part-time
nature, bridge jobs generally allow more flexibility than full-time career positions.
-"Golden parachute" agreements may include all of the following, except
cash.
company stock.
medical and life insurance.
reduced pension benefits. -- reduced pension benefits.
Golden parachute agreements may include various combinations of cash, company stock, medical and
life insurance, extra pension benefits, and other benefits.
-2017 Earnings cap for singles? -- $16,920
-A Cash Flow statement is used to calculate what? And what does it have on it? -- Inflows and out flows.
Not assets and liabilities.
-A direct rollover is a transaction in which benefits from a qualified plan are rolled over directly to
the individual with a check in their name.
a participant's checking or savings account.
another eligible retirement plan.
a conduit IRA. -- another eligible retirement plan.
A direct rollover may be accomplished by any reasonable means of direct payment to an eligible
retirement plan, including a wire transfer or mailing of a check negotiable only by the plan's trustee.
Using a conduit IRA is a means of an indirect rollover.
-A distribution cannot be made from a TSA until the employee does which of the following? --
Distributions can be made when an employee separates from service, attains age 591⁄2, becomes disabled
or dies, or qualifies under hardship rules.
,-A penalty is imposed for failing to take the required minimum distribution (RMD).
10%
20%
50%
100% -- 50%
The penalty for failing to take the RMD is 50% of the difference between what should have been taken
and what was taken.
-A power of attorney is an effective tool for incapacity planning if
it is a general power of attorney.
it is a durable power of attorney.
it is a springing power of attorney.
both b and c. -- both b and c.
A durable power of attorney continues after a principal's incapacity, and a springing power of attorney
becomes effective when the principal becomes incapacitated. The general power of attorney is not an
effective tool for incapacity planning for a simple reason: The agent's authority ceases when the
principal either dies or becomes incapacitated.
-A qualified plan must withhold 20% of any distribution that is
part of a trustee-to-trustee transfer.
rolled to a conduit IRA.
part of a lifetime annuity.
going to be rolled over to another qualified plan within 60-days. -- going to be rolled over to another
qualified plan within 60-days.
The 20% withholding rule does not apply to direct rollover distributions or trustee-to-trustee transfers;
the 20% withholding rule does apply to indirect rollover distributions, such as a 60-day rollover.
-A Roth IRA distribution is considered to be "qualified" if... -- ...a five-year holding period is met and the
distribution is made after the attainment of age 591⁄2, death, or disability, or if it is made for the purchase
of a first-time home (maximum $10,000).
-A standardized Medigap plan is designed to cover
long-term care expenses when treatment lasts longer than 100 days.
Medicare-approved charges that are not paid by Medicare.
charges that are considered nonmedical and are not covered by Medicare. -- Medicare-approved
charges that are not paid by Medicare.
Medigap insurance is designed to supplement Medicare's benefits by filling in some of what Medicare
does not cover, such as deductibles and coinsurance; it covers only Medicare-approved charges.
Standardized Medigap plans pay only for long-term care while the beneficiary qualifies for benefits from
Medicare, and is limited to paying the coinsurance from the 21st through 100th days.
,-A trustee-to-trustee transfer is an example of a
direct rollover.
indirect rollover.
conduit rollover.
60-day rollover. -- direct rollover.
A trustee-to-trustee transfer is an example of a direct rollover. A 60-day rollover would be an example of
an indirect rollover. A conduit IRA is used to shift assets from the qualified plan of one employer to the
qualified plan of another employer using the conduit IRA as an intermediate step.
-A worker's primary insurance amount (PIA) is the amount they receive from Social Security if... -- ...he
or she began payments at full retirement age.
-Active participation in what retirement plans for any part of a plan year ending within the individual's
taxable year may restrict his or her ability to deduct contributions to an IRA? -- a qualified pension, profit
sharing, stock bonus, money purchase, SIMPLE
401(k) plan, or Roth 401(k) plan;
a qualified plan established for employees by a federal, state, or local
government or their subdivisions, other than a Section 457 plan;
a tax-sheltered annuity plan (TSA) (also known as Section 403(b) plan) for
employees of public schools and certain tax-exempt organizations;
a simplified employee pension (SEP); or
a savings incentive match plan for employees (SIMPLE) IRA.
-Alicia has contributed $8,000 to a Roth IRA over the past four years. The account has grown to $10,000
with investment earnings. She is facing a financial bind and needs to withdraw $9,000. She will have to
pay income tax and a 10% penalty on
$1,000.
$8,000.
$9,000. -- $1,000.
Since the Roth contributions were made with after-tax dollars, Alicia can withdraw her contributions
first. She could withdraw the entire $8,000 that she has contributed without any tax or penalty. Only
$1,000 of her withdrawal will be subject to income tax or penalty.
-All of the following apply to voluntary early retirement programs except
they rarely result in lawsuits against the companies offering the programs.
they provide a set of incentives to reduce corporate headcount.
they present pluses and minuses for the eligible employee.
, they should be analyzed based on their future value. -- they should be analyzed based on their future
value.
Voluntary early retirement incentives provide a set of incentives to reduce corporate headcount. They
present pluses and minuses for the eligible employee that should be evaluated based on their net
present value. Such arrangements rarely result in lawsuits because employees select themselves for
termination.
-All of the following are characteristics of a Qualified Longevity Annuity Contracts (QLACs) except:
receipt of income payments is typically deferred until age 85.
the participant can elect either a fixed or variable annuity.
up to 25% of a qualified plan (or IRA) balance can be used to purchase a QLAC and be exempted from
RMD requirements.
they are a means of transferring longevity risk to an insurance company. -- the participant can elect
either a fixed or variable annuity.
QLAC's must be fixed (not variable) annuities. The other statements are true regarding QLAC's
-All of the following are disadvantages to performing an indirect rollover from a qualified plan to an
existing IRA except
the rollover must be completed within a 60-day period to avoid being taxed.
20% of the gross distribution will be withheld for taxes.
the entire distribution will be subject to immediate taxation. -- the entire distribution will be subject to
immediate taxation.
By rolling over assets to an existing IRA, the plan assets less the amount withheld escape immediate
taxation. Taxes are deferred until the participant begins withdrawing money. A mandatory 20%
withholding is imposed on a qualified plan distribution if the plan issues a check to the participant.
Finally, if an indirect rollover is not completed within 60-days the full distribution amount will be taxed.
-All of the following are true about the deductibles that apply to health insurance except
health insurance deductibles apply per incident.
a deductible is the amount that the insured must pay before the plan pays anything.
the deductible for Catastrophic and Bronze plans will be larger than for Gold or Platinum plans.
deductibles do not apply to many forms of preventive care. -- health insurance deductibles apply per
incident.
Unlike a homeowners or automobile policy, a health insurance deductible is an annual amount, not a
per incident amount. Preventive care and wellness benefits, such as mammograms and well-baby care,
are often paid 100% by the insurance company without a required deductible.
-All of the following are true regarding COBRA-mandated continuation of group medical coverage for
terminated employees except
proof of insurability is required.
