Retirement, College, & Other Accounts

Question 1

ABLE accounts are ___-sponsored investment accounts that are used to pay for ___.
The federal gift tax exclusion amount can be contributed to an ABLE account with ___ up to $18k in 2024.
Earnings build tax ____ and distributions to pay for ____ are tax ___.

Answer 1

State; qualifying disability expenses
No tax deduction
Deferred; qualifying disability expenses; free

Question 2

The penalty tax for not taking required minimum distributions from a qualified retirement plan (NOT ___s) is ___ of the shortfall.

Answer 2

ROTH; 25%

Question 3

For individual investors, capital base refers to money used to purchase ____ and subsequent purchases ___.

Answer 3

an initial investment; of that investment.

Question 4

Coverdell EDU Savings Accounts are not ___ and are not allowed for people earning over ___.

Answer 4

Tax deductible; $95k single or $190k family

Question 5

A state’s “Legal List” of purchasable securities applies to ___

Answer 5

“Prudent” investments considered conservative.

Question 6

The primary benefits of 529 college savings accounts are 1) ___ withdrawal 2) ___ growth 3) ___ Roth IRA.

Answer 6

Tax-free; tax-deferred; can roll over up to $35k

Question 7

When opening a Joint account, 1) Checks cannot be ___ 2) either party can place ___ 3) Checks can be authorized to be dispersed ___.

Answer 7

1) Issued only to one party
2) a trade
3) by either party