Question

1. peter molloy is considering making a contribution to an IRA, but his employer has a profit-sharing plan. Plan benefits vest over 6 years, and peter is 60% vested. The employer made no contribution to the plan for the year. No employees have terminated during the year. Which of the following statements concerning Peter’s contribution to an IRA is correct?
   1. peters contribution will not be deductible because contributions are not required every year to profit-sharing plan.
   2. Peters contribution will be deductible because his employer made no contribution to the profit-sharing plan for the year.
   3. Peters contribution will be deductible because he is not yet eligible for full benefits under the profit sharing plan.
   4. Peters contribution will not be deductible because his vesting will increase.

6. Yves is 54 years of age, and his wife Anne is 48 years of age. Yves earned $220000 at his job, but his employer does not sponsor a retirement plan. Anne earned $3500 last year working from home while caring for their children. If Yves and Anne file a joint tax return, how much can they contribute to deductible traditional IRAs?

a. $3500

b. $9000

c. $11000

d. $12000

8. Which of the following retirement plans can allow loans to the participants?

a. Keogh plan

b. SEP

c. SIMPLE IRA

d. Traditional IRA

10. Which of the following investments is permitted with an IRA or Roth IRA?

1) U.S. eagle gold coins

2) IBM Stock bought on margin

3) Universal variable life insurance contract.

A. 1 only

B. 1 and 2 only

C. 1 and 3 only

D. 2 and 3 only

11. In 2018, Craig Foster is 42 years of age and a participant in the 401(k) plan at his company. His gross income from his employment is $114000 and after salary deferral, his AGI is $111000. Craigs wife is 36 years of age and has not worked since the arrival of their first child. What is the maximum deduction the fosters could take for contribution to an IRA?

a. $0

b. $5500

c. $8250

D $11000

19. All the following statements concerning SEPs are correct, except:

A. SEPs can be advantageous to employers who have high employee turnover.

B. SEPs have no minimum contribution requirements.

C. SEPs are available to both self-employed individuals and employees of corporations.

D. like defines contribution plans, SEPs must be installed before the end of the tax year.

20. Which of the following statements concerning simplified employee pension (SEP) plan is correct?

1) The annual limitation on contributions, 25 percent of compensation, may not be applied separately to compensation from more than one employer.

2) Part-time employees who have earned over $600 annually in 3 of the last 5 years must be covered by the plan.

3) The employer can deny participant withdrawal rights until the termination of employment.

A. 1 only

B. 2 only

C. 1 and 3 only

D. 2 and 3 only

E. 1, 2 and 3 only

Answer 1

Question 5) Answer a

Question 6) Answer d

Question 8) Answer b

Question 10) Answer a

Question 11) Answer d

Question 19) Answer a

Question 20) Answer c