Chapter 3 Flashcards
retirement plan similar to a 401 k plan, but one that is offered by non-profit organizations, such as hospitals, schools, and some charitable organizations, rather than corporations
403B
defined contribution plan offered by a corporation to its employees, which allows employees to set aside tax-deferred income for retirement purposes
401k
non-qualified, deferred compensation plan established by state and local governments for tax-exempt government agencies and tax exempt government agencies and tax exempt employees
457 plan
college savings plan that allows individuals to save on a tax-deferred basis in order to fund future college and graduation school expenses or a child or beneficiary
529 plan
one who is responsible for an account listed in someone else’s name
Custodian
movement of tax-deffered retirement plan money from one qualified plan or custodian to another
Direct Transfer
after tax college fund that grows tax-free for educational uses; eligibility based on parents’ annual income
ESA
tax-deferred arrangement for individuals with earned income and their non-income producing spouses; growth is not taxed until money is withdrawn
IRA
paying for college ahead of tie by accumulating units of tuition
Pre-Paid Tuition
movement of funds from a tax-deferred retirement plan from one qualified plan or custodian to another
Rollover
retirement account funded with after-tax dollars that subsequently grows tax free
Roth IRA
pension plan in which both the employee and the employer contribute to an individual retirement account
SEPP
money that is working for you, either tax-deferred or tax free, within a retirement plan
Tax-Favored Dollars
legislation that provides a tax-effective manner of transferring property to minors without the complications of trusts or guardianship restrictions
UGMA
law similar to the Uniform Gifts to Minors Act that extends the definition of gifts to include real estate, paintings, royalties, and patents
UTMA
