Final Exam > Results Page
final exam score:
80%
Question 1
Incorrect
Which funds can be allocated to a Roth 401(k)?
(You Answered) Employer matching contributions
Plan forfeitures
(Correct Answer) Earnings on Roth 401(k) contributions
Earnings on Traditional 401(k) contributions
Question 2
Correct
Roth 401(k) contributions:
Cannot be made by high-income plan participants
(You Answered) (Correct Answer) Must be irrevocably designated before being made
Reduce W-2 income
Contribution limit of $5,000 in 2011
Question 3
Correct
Which type of qualified retirement plan can offer a Roth 401(k) option?
SIMPLE 401(k)
SARSEP
(You Answered) (Correct Answer) 403(b)
All of the above
Question 4
Incorrect
Investment earnings on a Roth 401(k):
(You Answered) Must be allocated to a traditional 401(k)
(Correct Answer) Must be allocated to the Roth 401(k)
Can be allocated in any way that the participant designates
Need not be allocated to the Roth 401(k)
Question 5
Correct
After funds have been in a Roth 401(k) for at least five years, distributions are tax free if taken for any of the following reasons except:
(You Answered) (Correct Answer) First-time home buying expenses
Attaining age 59-1/2
Being disabled
Death
Question 6
Correct
Which statement concerning Roth 401(k)s and Roth IRAs is correct?
The same annual contribution limits apply.
The same MAGI limits for making contributions apply.
(You Answered) (Correct Answer) Contributions can be made in the same year to both types of accounts.
Withdrawal is permitted for Economic hardship
Question 7
Correct
Which is the only type of conversion that is not permitted?
Roth 401(k) to Roth IRA
(You Answered) (Correct Answer) Roth IRA to Roth 401(k)
Traditional IRA to Roth IRA
Traditional 401(k) to Roth 401(k)
Question 8
Correct
Lifetime distributions are required from each of the following types of accounts except:
(You Answered) (Correct Answer) Roth IRA
Roth 401(k)
Traditional 401(k)
Traditional IRA
Question 9
Correct
Each of the following is an advantage of a Roth 401(k) except:
The participant has no recordkeeping responsibility.
Earnings can become tax free after five years.
(You Answered) (Correct Answer) Contributions can be withdrawn fully tax free at any time.
The first-time home buying distribution option.
Question 10
Correct
Who should probably not designate 401(k) contributions to a Roth option?
(You Answered) (Correct Answer) An older high-income taxpayer who expects to be in a lower tax bracket in retirement
A younger taxpayer in a low bracket now with many years until retirement
A taxpayer of any age who bets that tax rates will be higher in retirement than they are now
A taxpayer who is planning to leave retirement funds to charity