Health and Life Insurance Questions
with 100% Correct Answers
Section 529 Plans Correct Answer: - state provided
- can be funded by after tax dollars
- can pay prepaid tuition
- All earnings exempt from federal taxes
- If withdrawn for unqualified withdrawl, 10% penalty
Roth IRA Correct Answer: private retirement plan that taxes income before it is
saved, but which does not tax interest on that income when funds are used
upon retirement
Distributions don't have to start before 70.5
401(k) plan Correct Answer: Elective deferral plan that allows employee to
reduce compensation by a stated percentage on a tax deductible/ tax
differed basis; often the employer matches the employee contributions
Simplified Employee Pension (SEP) Correct Answer: A qualified plan in which a
smaller employer contributes specified amounts directly into IRA accounts on
behalf of eligible employees
403(b) plan Correct Answer: An elective deferral plan for employees of
organizations such as school systems, churches, and hospitals
Keogh Plan Correct Answer: Retirement plan for self-employed individual and
their qualified employees
, Rollover Correct Answer: Tax free withdrawal of cash or other assets from one
retirement program and its reinvestment in another program. It is not considered
income and it is not taxable until a later withdrawal. Has to be completed in 60
days
Transfer Correct Answer: When amounts of a qualified plan are transferred to
another qualified plan
Employee Retirement Income Security Act (ERISA) Correct Answer: Federal law
that increased the responsibility of pension plan trustees to protect retirees,
established certain rights related to vesting and portability, and created the
Pension Benefit Guarantee Corporation
profit-sharing plan Correct Answer: a benefit whereby employees may share in
the profits of the business
Catch-up Contributions Correct Answer: -for those aged 50 or older
-additional $1,000 annually
*Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) -
established the catch up provisions*
Rollover time frame Correct Answer: 60 days
Keogh Plan Correct Answer: A federally-approved, tax-deferred savings
program for self-employed people, allowing them to set money aside for their
retirement.
Annuity Period Correct Answer: the payout period of an annuity
with 100% Correct Answers
Section 529 Plans Correct Answer: - state provided
- can be funded by after tax dollars
- can pay prepaid tuition
- All earnings exempt from federal taxes
- If withdrawn for unqualified withdrawl, 10% penalty
Roth IRA Correct Answer: private retirement plan that taxes income before it is
saved, but which does not tax interest on that income when funds are used
upon retirement
Distributions don't have to start before 70.5
401(k) plan Correct Answer: Elective deferral plan that allows employee to
reduce compensation by a stated percentage on a tax deductible/ tax
differed basis; often the employer matches the employee contributions
Simplified Employee Pension (SEP) Correct Answer: A qualified plan in which a
smaller employer contributes specified amounts directly into IRA accounts on
behalf of eligible employees
403(b) plan Correct Answer: An elective deferral plan for employees of
organizations such as school systems, churches, and hospitals
Keogh Plan Correct Answer: Retirement plan for self-employed individual and
their qualified employees
, Rollover Correct Answer: Tax free withdrawal of cash or other assets from one
retirement program and its reinvestment in another program. It is not considered
income and it is not taxable until a later withdrawal. Has to be completed in 60
days
Transfer Correct Answer: When amounts of a qualified plan are transferred to
another qualified plan
Employee Retirement Income Security Act (ERISA) Correct Answer: Federal law
that increased the responsibility of pension plan trustees to protect retirees,
established certain rights related to vesting and portability, and created the
Pension Benefit Guarantee Corporation
profit-sharing plan Correct Answer: a benefit whereby employees may share in
the profits of the business
Catch-up Contributions Correct Answer: -for those aged 50 or older
-additional $1,000 annually
*Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) -
established the catch up provisions*
Rollover time frame Correct Answer: 60 days
Keogh Plan Correct Answer: A federally-approved, tax-deferred savings
program for self-employed people, allowing them to set money aside for their
retirement.
Annuity Period Correct Answer: the payout period of an annuity
