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Qualified Plans
Non-Qualified Plans
IRAs
Education Savings Plans
Numbers
100
1) In this type of plan, an employee’s retirement benefits are based on the amount that is contributed into the plan, plus any investment gains that are gains that are generated by those contributions. These plans are the current trend.
What is a Defined Contribution Plan?
100
This plan is not required to meet IRS standards regarding employee coverage, contribution limits, and vesting. The money being contributed to these plans are not tax deductible to the employer, however, the earnings grow tax-deferred.
What is a non-qualified plan?
100
Any person who is under the age of 70 ½ and has earned income from employment during the year may establish this type of retirement account.
What is a traditional IRA?
100
This account is for the benefit of a child under 18 and it is a savings vehicle for elementary, secondary, and post-secondary education. A parent, grandparent, or even complete stranger may contribute a maximum of $2,000 per year. Contributions are made with non-deductible after-tax dollars, and withdrawals are tax-free if used only for education expenses
What is a Coverdell Education Savings Account?
100
The maximum amount employees may contribute annually to a qualified plan and the catch up amount for employees 50+ in 2017.
What are $18,000 and $6,000 (catch-up)?
200
This plan allows employers to make discretionary contributions. Generally, all participants receive a certain percentage of their salary, but an employer may or may not be able to afford a contribution for a given year.
What is a Profit Sharing Plan?
200
These are established between employers and employees. The employers agree to pay their employees a certain amount of compensation at a later date, such as retirement, disability, death or employment termination.
What is Deferred Compensation Plans?
200
This is the additional amount that is allowed as a “catch-up” provision to individuals who need to save more in their IRA who are aged 50 or older.
What is $1000?
200
This plan has 2 types, and it is used specifically to save for higher education expenses.
What is a 529 College Savings Plan?
200
A married couple contribute up to this amount if only one spouse is employed, and the contribution is split into two separate IRAs. This higher amount is allowed if both are over 50,
What is $11,000 and $13,000? No more than $5500 into each account under 50, $6500 if over 50.
300
This feature within a qualified plan describes the portion of an employees retirement funds that have been contributed by his/her employer to which he/she is entitled if they leave their employer. These are generally used with 401(K) plans.
What is Vesting?
300
This clause, found in most deferred compensation agreements, are provisions which restrict the rights of an employee from receiving deferred monies. The purpose of these is to protect employers from paying benefits to employees who violate company policy.
What is a "bad-boy" clause?
300
Investors contribute to this with after-tax dollars. The accumulated earnings in the account may be received tax free if the account has been in existence for at least 5 years, and other specific conditions exist?
What is a Roth IRA?
300
This form of a 529 plan allows investors to purchase credits toward a child’s future at a state-run college for a reduced rate. These plans work best when the contributor is certain that their child will attend an “In-State” college/university. Books, room, and board are usually not covered.
What is a Prepaid Tuition Plan?
300
Employees may elect to make a maximum annual pre-tax contribution up to $12,500 in this plan (more if over 50). Employers can make contributions too.
What is a SIMPLE IRA?
400
This is a type of tax-deferred retirement plan that is available to employees of public school systems as well as employees of tax-exempt, non-profit organizations like charities and religious organizations. These plans are also know as TDA’s or TSA’s (Tax Sheltered Accounts)
What are 403(b) plans?
400
This type of plan is a non-qualified pension plan that is available to employees of state and local governments, as well as some not-for-profit organizations.
What is a 457 plan?
400
An account owner can take a distribution from her IRA without incurring a tax liability if they do this (provided she reinvests in an IRA or retirement plan with 60 days of receiving the check). Of course, it can only be done once every 12 months.
What is a rollover?
400
This plan is more flexible of the two types of 529 plans because it allows a contributor to cover qualified educational expenses, such as tuition, books, and room and board at any college or university in the nation.
What is a 529 Savings Plan?
400
A unique provision with 529 plans is that an investor may aggregate five years worth of annual gifts into one and contribute this amount all at once. A married couple is able to contribute this maximum amount without paying federal gift taxes.
What is $140,000 (5 X @28,000)?
500
Unlike 401(K) plans which allow participants to invest their contributions in any prudent manner, generally the funds in 403(b) plans may only be invested in these 3 types of accounts.
What are annuity contracts, custodial accounts that hold mutual fund shares, and retirement income accounts?
500
The potential benefit of these plans is that employees are allowed to use after-tax deductions from their paychecks to purchase life insurance, mutual funds, and variable annuities. Also, sales charges being assessed are usually lower than if they were to purchase these products separately.
What is a Payroll Deduction Plan?
500
This provision allows an owner to take their current IRA with one institution and distribute their account to a different institution. There are no limitations on the amount of times a person may do this, and the check is sent to the new trustee to complete the transaction. This is not a taxable transaction.
What is an IRA Transfer?
500
5) In a 529 Plan, an individual is able to contribute up $14,000 per year as a federal annual exclusion of this.
What are Gift Taxes?
500
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Who is Kobe Bryant?