ARIZONA LIFE ACCIDENT AND HEALTH OR
SICKNESS INSURANCE PRODUCER ACTUAL
EXAM QUESTIONS AND ANSWERS
◉ Qualified Plan distributions. Answer: - taxable upon withdrawl
- 10% penalty upon withdrawl before 59.6
- can take out w/o penalty if death, divorce, qualified financial
hardship, plan loan or qualified rollover, 1st time home buyer,
disability of owner
- if you take out the money early, its a 20% penalty
- must rollover w/in 60 days or its considered a premature
distribution
◉ Qualified Plan Requirements. Answer: 1) Be in writing 2)provided
for benefit of employee 3) must satisfy age and serive standards 4)
cannot be discriminatory 5) contributions cannot exceed yearly
maximus 6) must provide survivorship benefits 7) must meet
miniumum vesting standards 8) cannot be top heavy
◉ Advantages of Qualified plans. Answer: - employer and employee
contributions are tax deductivble and accumulate tax deferred
- Withdrawls before 59.5 is a 10% penalty
- must begin miniumum distributions by age 70.5
,◉ Penalty for Withdrawl of Qualified Plan. Answer: - a 10% penalry
plus applicable state and federal taxes
◉ IRA IIndividual Retirement Account). Answer: - all individuals
who have earned income
- possible tax deductions
- tax deferral of gains
- Can contribute up to 5,000
- can add 1,000 "catch up" if over 50
◉ Education IRA. Answer: - method to provide funding
- Can be transferred to another IRA at 30
◉ Section 529 Plans. 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- If withdrawn for unqualified withdrawl, 10% penalty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. Answer: - Allows owner to make non tax deductible
contributions
- to get withdrawls tax free, the account must be in existence for 5
years
- can add money tax free up to 5k
- distributions are tax free
- account is only allowed for people who's income does not exceed a
certain amount
◉ SEP IRA (simplified Employee Pension Plan). Answer: - employer
sponsored IRA for small employers
- contrinutions deductible to employer
- Employee must have worked for 3 of last 5 years
- contributions by employer cant exceed 49k or 25% of income,
whichever is lesser
- contributions for employees cant exceed 16,500
◉ Keogh Plan. Answer: - self employed and employees
- replaced by SEPs
◉ 401k Plan. Answer: - allows employees to save for retirement tax
free
- money is taken out pre-tax, and can be matched (and deductible to
employwer)
, - Withdrawl penalty of 10% prior to age 59.5
- Miniumum distributions by age 70.5
- 2011 max was 16,500
◉ 403(b)/tax-sheltered Annuity. Answer: - availbale for employees
of nonprofits, schools universities, churches & hospitals
- just like 401k plans
◉ 457 Deffered Compensation. Answer: - available for employess of
state and local govt
-the plan is owned by employer
◉ Profit Plan. Answer: - part of defined contribitution plan
- annual profits shared among employees
- no guarantee of payment
◉ Pension Plan. Answer: Retirement Plan that calculates benefit
based upon years of service and income averages
◉ ESOP. Answer: - employee stock ownership plan
- defined contribution plan that provides employer stock to
employees based on income and profits of company
SICKNESS INSURANCE PRODUCER ACTUAL
EXAM QUESTIONS AND ANSWERS
◉ Qualified Plan distributions. Answer: - taxable upon withdrawl
- 10% penalty upon withdrawl before 59.6
- can take out w/o penalty if death, divorce, qualified financial
hardship, plan loan or qualified rollover, 1st time home buyer,
disability of owner
- if you take out the money early, its a 20% penalty
- must rollover w/in 60 days or its considered a premature
distribution
◉ Qualified Plan Requirements. Answer: 1) Be in writing 2)provided
for benefit of employee 3) must satisfy age and serive standards 4)
cannot be discriminatory 5) contributions cannot exceed yearly
maximus 6) must provide survivorship benefits 7) must meet
miniumum vesting standards 8) cannot be top heavy
◉ Advantages of Qualified plans. Answer: - employer and employee
contributions are tax deductivble and accumulate tax deferred
- Withdrawls before 59.5 is a 10% penalty
- must begin miniumum distributions by age 70.5
,◉ Penalty for Withdrawl of Qualified Plan. Answer: - a 10% penalry
plus applicable state and federal taxes
◉ IRA IIndividual Retirement Account). Answer: - all individuals
who have earned income
- possible tax deductions
- tax deferral of gains
- Can contribute up to 5,000
- can add 1,000 "catch up" if over 50
◉ Education IRA. Answer: - method to provide funding
- Can be transferred to another IRA at 30
◉ Section 529 Plans. 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. Answer: - Allows owner to make non tax deductible
contributions
- to get withdrawls tax free, the account must be in existence for 5
years
- can add money tax free up to 5k
- distributions are tax free
- account is only allowed for people who's income does not exceed a
certain amount
◉ SEP IRA (simplified Employee Pension Plan). Answer: - employer
sponsored IRA for small employers
- contrinutions deductible to employer
- Employee must have worked for 3 of last 5 years
- contributions by employer cant exceed 49k or 25% of income,
whichever is lesser
- contributions for employees cant exceed 16,500
◉ Keogh Plan. Answer: - self employed and employees
- replaced by SEPs
◉ 401k Plan. Answer: - allows employees to save for retirement tax
free
- money is taken out pre-tax, and can be matched (and deductible to
employwer)
, - Withdrawl penalty of 10% prior to age 59.5
- Miniumum distributions by age 70.5
- 2011 max was 16,500
◉ 403(b)/tax-sheltered Annuity. Answer: - availbale for employees
of nonprofits, schools universities, churches & hospitals
- just like 401k plans
◉ 457 Deffered Compensation. Answer: - available for employess of
state and local govt
-the plan is owned by employer
◉ Profit Plan. Answer: - part of defined contribitution plan
- annual profits shared among employees
- no guarantee of payment
◉ Pension Plan. Answer: Retirement Plan that calculates benefit
based upon years of service and income averages
◉ ESOP. Answer: - employee stock ownership plan
- defined contribution plan that provides employer stock to
employees based on income and profits of company
