SIE - Securities Industry Essentials Exam

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Which of the following BEST describes a qualified plan?

An employer sponsored plan where contributions are made by the employer when an employee qualifies with a certain amount of tenure.
A
An employer sponsored plan that where income tax is not paid on the employer contributed amounts until money is withdrawn.
B
An individual retirement plan where tax is paid up front and money can be withdrawn tax free during retirement.
C
An individual retirement plan where tax deductible contributions are made and taxes are paid when money is withdrawn.
D

Explanations

B describes a qualified plan. Qualified plans are employer sponsored retirement plans that have special tax treatment under section 401(a) of the tax code.