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My CFP Flashcards > BIG RETIREMENT CONCEPTS (Every Day) > Flashcards

BIG RETIREMENT CONCEPTS (Every Day) Flashcards

1
Q

RETIREMENT: Is a SEP a qualified or non-qualified plan?

A

NQ

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2
Q

RETIREMENT: Is a SIMPLE IRA a qualified or non-qualified plan?

A

NQ

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3
Q

RETIREMENT: Is a sarsep a qualified or non-qualified plan?

A

NQ

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4
Q

RETIREMENT: Is a Thrift savings plan a qualified or non-qualified plan?

A

NQ

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5
Q

RETIREMENT: Is a 403b plan a qualified or non-qualified plan?

A

NQ

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6
Q

RETIREMENT: Is a 457 plan a qualified or non-qualified plan?

A

NQ

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7
Q

RETIREMENT: Can a non qualified plan discriminate?

A

Yes

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8
Q

RETIREMENT: Are qualified plans subject to ERISA rules?

A

yes

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9
Q

RETIREMENT: For NQ plans, when are contributions deducted by employer?

A

When the employee is taxed on them

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10
Q

RETIREMENT: For NQ plans, who are plan earnings taxable to?

A

The employer

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11
Q

RETIREMENT: For NQ plans, distributions are taxable at ___ rates.

A

ordinary

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12
Q

RETIREMENT: Is a money purchase plan a qualified or non-qualified plan?

A

Q

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13
Q

RETIREMENT: Is a target benefit a qualified or non-qualified plan?

A

Q

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14
Q

RETIREMENT: Is a profit sharing a qualified or non-qualified plan?

A

Q

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15
Q

RETIREMENT: Is a profit sharing 401K a qualified or non-qualified plan?

A

Q

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16
Q

RETIREMENT: Is a stock bonus plan a qualified or non-qualified plan?

A

Q

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17
Q

RETIREMENT: Is a ESOP a qualified or non-qualified plan?

A

Q

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18
Q

RETIREMENT: Is a Keogh a qualified or non-qualified plan?

A

Q for self employed, but they have both defined contributions and defined benefit plan options.

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19
Q

RETIREMENT: Is a defined benefit pension plan a qualified or non-qualified plan?

A

Q

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20
Q

RETIREMENT: Is a money purchase pension plan DC or DB?

A

DC

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21
Q

RETIREMENT: Is a Target benefit pension plan DC or DB?

A

DC

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22
Q

RETIREMENT: Is a stock bonus plan DC or DB?

A

DC

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23
Q

RETIREMENT: Is a profit sharing plan DC or DB?

A

DC

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24
Q

RETIREMENT: Do 412i plans have a mandatory employer contributions?

A

no

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25
Q

RETIREMENT: In a profit sharing plan that’s funded solely with employer contributions, can participants sue?

A

no

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26
Q

RETIREMENT: What is the annual contribution limit for defined contribution plans?

A

25% of covered comp

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27
Q

RETIREMENT: How are forfeitures allocated in a defined contribution plan?

A

Reduce plan costs or allocate to other participants

28
Q

RETIREMENT: How are forfeitures allocated in a defined benefit plan?

A

Reduce plan costs

29
Q

RETIREMENT: Are in service withdrawals permitted from a pension plan?

A

Pension plans may permit distributions to current employees who have attained age 59.5

30
Q

RETIREMENT: Are contributions discretionary in a pension plan? What about a profit sharing plan?

31
Q

RETIREMENT: Are in service withdrawals permitted from a profit sharing plan?

A

Yes, after 2 years if plan document allows

32
Q

RETIREMENT: Can a SEP integrate with SS?

33
Q

RETIREMENT: Can a simple integrate with SS?

34
Q

RETIREMENT: Can a Money purchase plan integrate with SS?

A

It could be

35
Q

RETIREMENT: Are plan loans available from SEPs Simples or Keoghs?

36
Q

RETIREMENT: Do QDROs apply to SEPs SIMPLES or Keoghs?

37
Q

RETIREMENT: Are contributions to a simple mandatory?

38
Q

RETIREMENT: Keoghs are only for who?

A

Sole props and partnerships

39
Q

RETIREMENT: Are RMDs required from a SEP if employee is still working?

40
Q

RETIREMENT: Are RMDs required from a Simple if employee is still working?

41
Q

RETIREMENT: Are simples easy to administer?

42
Q

RETIREMENT: Can you invest in life insurance in a SEP or SIMPLE?

43
Q

RETIREMENT: What is the creditor protection for SEPs and SIMPLES?

A

protected by state law (can differ)

44
Q

RETIREMENT: What is the creditor protection for qualified plans (both DB and DC)

A

protected per ERISA

45
Q

RETIREMENT: Can ESOPS be integrated with social security?

46
Q

RETIREMENT: Who is a simple for?

A

Employers with less than 100 employees

47
Q

RETIREMENT: What are the contribution amounts for Target benefit plans?

A

It’s based on age and compensation. It’s like an age weighted profit sharing plan, but it’s a pension plan.

48
Q

RETIREMENT: What are the contribution amounts for Money purchase pension plan?

A

Flat percentage between 0-25%

49
Q

RETIREMENT: Do MPPs need to be funded annually?

50
Q

What’s the difference for RMD rules between qualified plans (DB DC) and non qualified plans (SIMPLE and SEP)

A 
qualified plans (DB DC) - 72 or separations from service
non qualified plans (SIMPLE and SEP)- 72
51
Q

Minimum benefits and contributions for non-key employees (for top heavy plans)

A

DB- benefit must be 2% of compensation

DC- minimum employer contribution can be no less than 3%.

52
Q

Which qualified plan is NOT subject to the minimum funding standard?

A

profit sharing plans

53
Q

What are the 9 exceptions to “special purposes” of withdrawing from the earnings portion of a roth where there is no income tax penalty and no early withdrawal penalty if they fail to meet the 5 year holding requirement?

A 
59.5
Death 
Disability 
First time home purchase (up to 10K)
Medical expenses 
Medical insurance premiums while unemployed
substantially equal periodic payments 
higher education expenses
birth/adoption
54
Q

RETIREMENT: Is a cash balance pension plan DC or DB?

55
Q

RETIREMENT: What is the big deal about cash balance pension plans?

A

The employer contribution of guaranteed AND has a guaranteed minimum rate of return

56
Q

Are hardship withdrawals allows from profit sharing plans?

57
Q

Are 401K deferrals subject to FICA and FUTA

58
Q

Are SIMPLE IRA deferrals subject to FICA and FUTA

59
Q

What is the salary cap for a simple IRA plan

A

NONE- but it DOES apply to 401k simple

60
Q

What are SEP IRA contribution limits?

A

25% (not 100%) of compensation or $58,000

* If taking the 58,000 is more than 25% of the pay, your have to do the lesser. so you’d have to do the 25% of pay

61
Q

Per the ______ test, the plan must cover a percentage of NHCE that is at least ____% of the HCE covered

A

ratio percentage test

70%

62
Q

Per the ______ test, the average benefits for all NHCE must be at least ___% of that for the HCE

A

average benefits test

70% (same as other test)

63
Q

Permitted vesting schedule for Top heavy DB plans and all defined contribution plans

A

3 year cliff or 2-6 year graded

64
Q

Permitted vesting schedule for NON top heavy DB plans and all defined benefit plans

A

5 year cliff or 3-7 year graded

65
Q

What are the three main plan types that cannot integrate with ss?

A

esop
simple
401K simple

My CFP Flashcards (21 decks)

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