IRA

Question 1

Traditional IRA

Answer 1

Earned income, regardless of age, pretaxed, up to a lmit, dedectable. withdral 59.5 - 72 10% early withdreal fee

Question 2

Roth IRA

Answer 2

Earned income, regardless of age, contributons (AFTER TAX), up to limit, not deductible, withdrawals. NO age 72 rule. Not taxed.

Question 3

IRA early withdrawl

Answer 3

without penalty…total disability, catastrophic medical expenses, downpay for first home up to 10K, or post-secondary education.

Question 4

IRA Rollovers

Answer 4

rollover tax-free distibution of cash from one retirement plan to another. direct transfer tax free transfer of funds from one retirement program to traditional IRA. Must be done in 60 days. In test world, Rollover, if they send check direct they will keep 20percent to IRS. Better to do a direct transfer, then

Question 5

5 plans for employers

Answer 5

SEP self employed or SMALL employer - employer funds.
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SIMPLE for small employer less than 100 employees - employer matches contributions.
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401K any employer (large)-employer matches contributions.
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403(b) - TSA - non-profit/charity. employee and employer.

Question 6

Business Uses of Life insurance (Key person)

Answer 6

Key employee is the insured, special knowldge skills, contracts.
Business is the applicant/policy owner/premium payer and the beneficiary.

Question 7

Buy-Sell agreement

Answer 7

legal contract that determines what will be done with the business when an owner dies or becomes disabled. Also known as business continuation agreement.

Question 8

what is taxable?

Answer 8

Excess cash value and interest on dividends

Question 9

MEC and & pay Tests MEC is always and will always be

Answer 9

Modified Endowment Contract

Question 10

who’s eligible for social security disability benefits

Answer 10

40 work credits - 5 month waiting period - benefit based on PIA - and stops when retired or disability ends.

Question 11

DIrector of Insurance

Answer 11

HEad of Illinois. Appointed by Governor, has rights and powers to enforce and execute the insurance laws.

Question 12

Director’s power

Answer 12

Issue ceast and disist orders and fines.

Question 13

Exam

Answer 13

Audit

Question 14

Types of Licenses

Answer 14

Producer (Agent) Business entity, Non resident and temporary license.

Question 15

Temp license,

Answer 15

for applicants expected to be licensed permanelty up to 90 days. or spouces in event producers death 180 days.

Question 16

Bonds

Answer 16

if you take money and wire it you will need a bond

Question 17

COntinuing education

Answer 17

24 hours every license period 3 must be ethics and in classroom. License period 2 years.

Question 18

Notify depoart of Insurace of moves or if being sued…

Answer 18

within 30 days of move or fine.

Question 19

Reinstatement

Answer 19

12 months without retake exam, just pay fee. Pay request waiver only if lapse due to military.

Question 20

If license revoked or suspended, can not be reapplied for ____ years

Answer 20

3

Question 21

Fiduciary responsibility

Answer 21

Keep customer money seperate Premium Fund Trust Account (PFTA).

Question 22

Producer Regulation

Answer 22

Books and records PFTA must be posted every 30 days. Must maintain books for 7 hears. Return of premiums within 15 days. any compensation that is more than 10% must provide written disclosure and signature of consumer.

Question 23

Ads must be kept on file for

Answer 23

4 years or next audit

Question 24

Insurance Guaranty Association

Answer 24

If an insurance company went out of business, this association will pay out claims.