Assignment 5 - Week 5 Other Employer Retirement Plans...

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Week 5 Other Employer Retirement Plans Review Questions 1. Which of the following are requirements related to having a Keogh plan? (1) participants must be self-employed (2) business must be unincorporated (3) more than 5% owners may not contribute to a plan (4) employment income can be contributed, but only accompanied by self- employment income a. (1) only b. (1) and (2) only c. (1) (2) and (3) only d. (2) (3) and (4) only 2. In a defined contribution plan Keogh, what is the maximum percentage of participant income allowable for annual deductible plan contributions? a. 10 b. 15 c. 25 d. 30 3. As used with Keogh plans, which one of the following best represents the definition of earned income? a. net income after all deductions including the deduction for Keogh plan contributions b. net income after all deductions but not including the deduction for Keogh plan contributions c. gross income, but Keogh plan contributions must be deducted d. gross income without deducting for Keogh plan contributions 4. Which of the following is true about the use of life insurance in a Keogh plan? (1) the entire cost of life insurance is deductible as a plan contribution (2) the pure life insurance element of an insurance premium is not deductible (3) the portion of the premium that exceed the pure protection value of the insurance is deductible (using Table2001) (4) the nondeductible life insurance element essentially becomes additional taxable income a. (1) and (2) only b. (2) and (4) only c. (1) (2) and (3) only d. (2) (3) and (4) only
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5. What is the maximum amount an eligible employee can contribute (in 2009) to a SIMPLE IRA (not including any catch-up) contributions? a. $4,000
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Assignment 5 - Week 5 Other Employer Retirement Plans...

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