Question

Chapter 7 - Question 6 :

Please help me to explain these questions. Thank you

Which of the following is correct regarding converting traditional IRA funds to a Roth IRA?

A.            Only taxpayers with AGI less than $100,000 may convert traditional IRA funds to a Roth IRA.

B.            The conversion is tax and penalty free if done as a direct rollover.

C.            The conversion can be recharacterized if done before the due date of the tax return (including extensions).

D.            None of the above.

Question 8 :

BJ has a vested account balance in his employer-sponsored qualified money purchase pension plan of $60,000. He has two years of service with his employer and the plan follows the least generous graduated vesting schedule permitted under PPA 2006. If BJ has an outstanding loan balance within the prior 12 months of $15,000, what is the maximum loan BJ could take from this qualified plan, assuming the plan permitted loans?

A.            $15,000

B.            $30,000

C.            $35,000

D.            $50,000

Answer 1