Taxes, Retirement, Other Flashcards
What are the three things that are considered when issuing a group policy?
Size
Turnover
Financial Strength
After an employee terminates their group insurance, how long do they have to convert it to individual insurance?
31 days
What percentage of employees must be included in a contributory plan?
75%
When an employee contributes to a Qualified Retirement Plan how is this taxed?
Not taxed as income
Earnings are tax deferred
Who can use an HR-10/ Keogh Plan?
Those who are self-employed
How much of a business must you own in order to qualify for the HR-10/ Keogh Plan?
10%
What is a Profit-Sharing Retirement Plan?
A portion of the company’s profit is contributed to the plan and shared with employees
What is the earliest & latest withdrawal of funds from a HR-10/ Keogh Plan can begin?
Earliest is 59.5
Latest is 70.5
How do employees contribute to their 401 (k)?
They take a reduction in current salaries
Rest goes into a retirement fund
Can a company match an employees contribution to their person 401 (k) plan?
Yes.
What are the three forms of 401 (k)?
- Pure salary reduction Plan
- Bonus Plan
- Thrift Plan
What does the employer do when an employee contributes to their 401 (k) Bonus or Thrift Plan?
Employer contributes a certain amount or percentage for every dollar that the employee contributes.
Is an employee required to contribute to their 401 (k)?
No
When can you withdraw early on your 401 (k) Plan?
With disability or death
Who is the 403(b)/ Tax-Sheltered Annuity for?
Non-profit organizations and employees of public school systems.
How much can be contributed into an IRA?
Up to 100% of earned income up to a specified amount
Which retirement plan requires you to make catch-up contributions and at what age?
IRAs at age 50 or older
What is a Roth IRA funded with?
After-tax contributions.
How long can you contribute to a Roth IRA?
Can continue past age 70.5 and distributions don’t have to start at 70.5
What is the penalty for excess contribution to a Roth IRA?
6%
What is a Rollover?
Tax-free distribution of cash from one retirement plan to another.
How long is someone expected to be permanently disabled before they can received social security benefits?
12 months or lead to death
How long is the waiting period to receive disability benefits?
5 months
What is a 7-pay test?
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.
