Plan Types

Question 1

What is the primary purpose of an Individual Retirement Account (IRA)?

Answer 1

To provide individuals with a tax-advantaged way to save for retirement.

Question 2

True or False: Contributions to a Roth IRA are tax-deductible.

Answer 2

False

Question 3

Fill in the blank: A Tax Sheltered Annuity is also known as a ______.

Answer 3

403(b) plan

Question 4

What is a key benefit of a Roth IRA compared to a traditional IRA?

Answer 4

Qualified withdrawals are tax-free.

Question 5

Multiple Choice: Which of the following plans is specifically designed for self-employed individuals? A) 401(k) B) Keogh Plan C) Traditional IRA

Answer 5

B) Keogh Plan

Question 6

What age must one be to avoid penalties for early withdrawal from a traditional IRA?

Answer 6

59½ years old

Question 7

True or False: Contributions to a Keogh Plan can be made by both the employer and the employee.

Answer 7

True

Question 8

Short Answer: What is the tax treatment of contributions to a Tax Sheltered Annuity?

Answer 8

Contributions are made pre-tax, reducing taxable income.

Question 9

Fill in the blank: A Self-Employed Pension is also known as a ______.

Answer 9

SEP IRA