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Emily CFP Cards > Retirement and Income Planning > Flashcards

Retirement and Income Planning Flashcards

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CFP® flashcards
1
Q

Are 457 plans aggregated with deferrals into other plans?

A

No

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2
Q

What is the catch-up contribution for 457 plans (over age 50)?

A

$7,500

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3
Q

What is the catch-up contribution for 403(b) plans (over age 50)?

A

$7,500

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4
Q

A “fully insured” traditional DB plan is funded exclusively by:

A

cash value life insurance or annuity contracts

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5
Q

What is the shortcut for 25% SE for contributing to a retirement plan?

A

18.59%

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6
Q

Are employer contributions mandatory for a SEP IRA?

A

no

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7
Q

What is the only retirement plan that does not consider “active participation” for IRA deductibility purposes?

A

457 plans

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8
Q

In a DB plan, what constitutes “active participation” for IRA deductibility purposes?

A

simply being eligible

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9
Q

Can you have a SIMPLE IRA if you have another retirement plan established already?

A

no

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10
Q

How many employees are required for an employer to be eligible to establish a SIMPLE IRA?

A

no more than 100 employees

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11
Q

Are employer contributions mandatory for a SIMPLE IRA?

A

yes

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12
Q

What are the minimum employee coverage requirements for a SIMPLE IRA?

A

all employees who:
- have compensation of at least $5,000 in any 2 prior years
- are expected to earn at least $5,000 in the current year

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13
Q

What are the minimum employee coverage requirements for a SEP IRA?

A

all employees who:
- are at least 21 years old
- employed with the company in the 3 of last 5 years
- earns at least $750 in compensation

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14
Q

What is the catch-up contribution amount for a SIMPLE IRA?

A

$3,500

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15
Q

What is the maximum employee deferral amount for a SIMPLE IRA?

A

$16,000

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16
Q

Can an employee defer into a SEP IRA?

A

no

17
Q

Which qualified plan must use a 3-year cliff vesting schedule?

A

cash balance

18
Q

All DB plans must have which kind of payout, unless waived?

A

joint and survivor

19
Q

What is the shortcut percentage for SE tax when the SS wage base is below $168,600?

A

14.13%

20
Q

What is the % for Medicare tax?

A

2.9%

21
Q

What is the maximum rate that an SE employer can contribute to a DC plan?

A

25%

22
Q

In a SIMPLE IRA, withdrawals within 2 years of enrollment are subject to what kind of penalty?

A

25%

23
Q

What is the maximum contribution that an employer can make to a SEP each year?

A

25% of payroll but no more than $69,000

24
Q

What is the catch-up contribution limit for a SIMPLE IRA?

A

$3,500

25
Q

How many traditional rollovers are allowed in a year?

A

1

26
Q

How many days does a participant have to deposit funds into an IRA or a different employer plan once a traditional rollover has paid?

A

60

27
Q

How many direct transfer rollovers can a participant make each year?

A

no annual limit

28
Q

A traditional rollover from a qualified plan requires how much federal income tax to be withheld?

A

20%

29
Q

In an inherited IRA, the spouse can be treated how?

A

as the owner

30
Q

If a spouse chooses to be treated as the owner in an inherited IRA, when can they defer RMDs until?

A

age 72

31
Q

Can a spouse beneficiary of an inherited IRA combine it with their own IRA?

A

yes

32
Q

For a non-spouse beneficiary of an IRA, how long do they have to withdraw funds from the IRA?

A

10 years

33
Q

Do Roth IRAs require RMDs, even if inherited?

A

never

34
Q

If a minor receives an inherited IRA, how long do they have to withdraw the funds?

A

their 10-year clock begins at age of maturity

35
Q

Who are eligible designated beneficiaries?

A
  • spouse
  • chronically ill person
  • disabled person
  • minor children
  • individuals not more than 10 years younger than the IRA owner
36
Q

Who can spread distributions over their lifetime from an inherited IRA?

A

eligible designated beneficiaries

37
Q

Who does the 10-year rule apply to when it comes to inherited IRAs?

A
  • non-spouse beneficiary
  • see-through trusts
  • successor beneficiaries
38
Q

A non-qualified distribution within 5 years of a Roth conversion may be subject to:

A

a 10% penalty

Emily CFP Cards (6 decks)

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