Taxes, Retirement, Other

Question 1

What are the three things that are considered when issuing a group policy?

Answer 1

Size
Turnover
Financial Strength

Question 2

After an employee terminates their group insurance, how long do they have to convert it to individual insurance?

Answer 2

31 days

Question 3

What percentage of employees must be included in a contributory plan?

Answer 3

75%

Question 4

When an employee contributes to a Qualified Retirement Plan how is this taxed?

Answer 4

Not taxed as income

Earnings are tax deferred

Question 5

Who can use an HR-10/ Keogh Plan?

Answer 5

Those who are self-employed

Question 6

How much of a business must you own in order to qualify for the HR-10/ Keogh Plan?

Answer 6

10%

Question 7

What is a Profit-Sharing Retirement Plan?

Answer 7

A portion of the company’s profit is contributed to the plan and shared with employees

Question 8

What is the earliest & latest withdrawal of funds from a HR-10/ Keogh Plan can begin?

Answer 8

Earliest is 59.5

Latest is 70.5

Question 9

How do employees contribute to their 401 (k)?

Answer 9

They take a reduction in current salaries

Rest goes into a retirement fund

Question 10

Can a company match an employees contribution to their person 401 (k) plan?

Answer 10

Yes.

Question 11

What are the three forms of 401 (k)?

Answer 11

1. Pure salary reduction Plan
2. Bonus Plan
3. Thrift Plan

Question 12

What does the employer do when an employee contributes to their 401 (k) Bonus or Thrift Plan?

Answer 12

Employer contributes a certain amount or percentage for every dollar that the employee contributes.

Question 13

Is an employee required to contribute to their 401 (k)?

Answer 13

No

Question 14

When can you withdraw early on your 401 (k) Plan?

Answer 14

With disability or death

Question 15

Who is the 403(b)/ Tax-Sheltered Annuity for?

Answer 15

Non-profit organizations and employees of public school systems.

Question 16

How much can be contributed into an IRA?

Answer 16

Up to 100% of earned income up to a specified amount

Question 17

Which retirement plan requires you to make catch-up contributions and at what age?

Answer 17

IRAs at age 50 or older

Question 18

What is a Roth IRA funded with?

Answer 18

After-tax contributions.

Question 19

How long can you contribute to a Roth IRA?

Answer 19

Can continue past age 70.5 and distributions don’t have to start at 70.5

Question 20

What is the penalty for excess contribution to a Roth IRA?

Answer 20

6%

Question 21

What is a Rollover?

Answer 21

Tax-free distribution of cash from one retirement plan to another.

Question 22

How long is someone expected to be permanently disabled before they can received social security benefits?

Answer 22

12 months or lead to death

Question 23

How long is the waiting period to receive disability benefits?

Answer 23

5 months

Question 24

What is a 7-pay test?

Answer 24

Cumulative premiums during the first 7 years of the policy must not exceed total amount of net level premiums that would be required to pay policy up using guaranteed mortality cost and interest.