Chater 7: Distributions From Qualified Plans

Question 1

For Qualified Disasters how much penalty-free distributions may be taken from Qualified accounts?

Answer 1

up to $22,000 per qualified disaster

Question 2

What is the Qualified Disaster incident period?

Answer 2

180 days after the qualified disaster occured

Question 3

the early distribution penalty of 10% does not apply when the purpose is for paying qualified higher education costs in what kind of plan only?

Answer 3

IRA

Question 4

List all the exceptions to the 10% early withdrawal penalty for qualified plans.

Answer 4

Age 59 1/2 , death, and disability
substantially equal periodic payments
separated from service after attaining age 55
dividends from an ESOP
IRS tax levy on a plan
unreimbursed medical expenses that exceed 7.5% of AGI
QDRO
military reservists who are called to active duty
public safety officer who separates from service after the earlier of age 50 or 25 years of service.
birth or adoption
for terminal illness (death must be expected within 84 months)
presidentially declared disaster
Victims of domestic abuse
up to 1000 for emergency savings distributions
distributions from pension-linked emergency savings accounts
qualified long term care distributions

Question 5

Distributions for retirement at age 55, but before 59 1/2, are not allowed in what kind of plan?

Answer 5

IRA

Question 6

what are the two basic approaches for QDRO?

Answer 6

shared payment approach and the separate interest approach

Question 7

the shared payment approach

Answer 7

splits the actual benefit payments made between both parties

Question 8

the separate interest approach

Answer 8

splits retirement accounts into two separate accounts.