Individual Income Taxes
43rd Edition
ISBN: 9780357109731
Author: Hoffman
Publisher: CENGAGE LEARNING - CONSIGNMENT
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Question
Chapter 19, Problem 1DQ
To determine
Ascertain whether each of the following independent statements is best applied to a defined contribution plan (DCP), a defined benefit plan (DBP), Both (B), or neither (N).
Expert Solution & Answer
Explanation of Solution
Defined contribution plans: In a defined contribution plan, the additions made to an employee’s account annually cannot exceed the lesser;
- “$56,000 (during 2019)”, (or)
- “100 percent of the compensation made by the employees”.
Defined Benefit plans: In a defined benefit plan, the annual benefit paid to an employee is restricted to the lesser of the following;
- “$225,000 (in 2019)” or
- “100% of the average compensation for the highest three years of employment”.
Ascertain whether each of the following independent statements is best applied to a defined contribution plan (DCP), a defined benefit plan (DBP), Both (B), or neither (N).
| Serial Number | Applied to the best of |
| a. | DBP. |
| b. | DCP. |
| c. | DBP. |
| d. | N. |
| e. | DBP. |
| f. | B. |
| g. | N. |
| h. | DCP. |
| i. | DCP. |
| j. | DBP. |
Table (1)
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Students have asked these similar questions
Classify each of the following independent statements as applying to a "Defined Contribution plan", "Defined Benefit plan", "Both" or
"Neither" by selecting from the dropdown list.
Type of Plan
The amount to be received at retirement depends on actuarial calculations.
Defined Benefit plan
a.
b. Forfeitures can be allocated to the remaining participants' accounts.
c. Requires greater reporting requirements and more actuarial and administrative
costs.
d. May exclude employees who begin employment within five years of normal
retirement age.
e. Annual addition to each employee's account may not exceed the smaller of
$58,000 or 100% of the employee's salary.
f. The final benefit to a participant depends upon investment performance.
Determine whether each of the following independent statements best applies to a defined contribution plan (DCP), a defined benefit plan (DBP), both (B), or neither (N).
The amount to be received at retirement depends on actuarial calculations.
2. Forfeitures can be allocated to the remaining participants’ accounts.
3. Requires greater reporting requirements and more actuarial and administrative costs.
4. May exclude employees who begin employment within five years of normal retirement age.
5. Annual addition to each employee’s account may not exceed the smaller of $57,000 or 100% of the employee’s salary.
6. The final benefit to a participant depends upon investment performance.
Amounts that come from accounts of unvested employees that can be directed/contributed to the accounts of other employees who participate and remain in the plan are known as what?
Select one:
a.
Matching contributions
b.
Excess contributions
c.
Forfeitures
d.
Rollover contributions
Chapter 19 Solutions
Individual Income Taxes
Ch. 19 - Prob. 1DQCh. 19 - Prob. 2DQCh. 19 - Prob. 3DQCh. 19 - Prob. 4DQCh. 19 - Prob. 5DQCh. 19 - Prob. 6DQCh. 19 - Prob. 7DQCh. 19 - Prob. 8DQCh. 19 - Prob. 9DQCh. 19 - Prob. 10DQ
Ch. 19 - Prob. 11DQCh. 19 - Prob. 12DQCh. 19 - Prob. 13DQCh. 19 - Prob. 14CECh. 19 - Prob. 15CECh. 19 - Prob. 16CECh. 19 - Prob. 17CECh. 19 - Zack, a sole proprietor, has earned income of...Ch. 19 - Prob. 19CECh. 19 - Prob. 20CECh. 19 - Prob. 21CECh. 19 - Prob. 22CECh. 19 - Prob. 23CECh. 19 - Prob. 24CECh. 19 - Prob. 25CECh. 19 - On April 5, 2017, Gustavo was granted an NQSO for...Ch. 19 - Prob. 27PCh. 19 - Prob. 28PCh. 19 - Prob. 29PCh. 19 - Prob. 30PCh. 19 - Prob. 31PCh. 19 - Prob. 32PCh. 19 - Prob. 33PCh. 19 - Prob. 34PCh. 19 - In 2019, Magenta Corporation paid compensation of...Ch. 19 - Prob. 36PCh. 19 - Prob. 37PCh. 19 - Prob. 38PCh. 19 - Prob. 39PCh. 19 - Prob. 40PCh. 19 - Prob. 41PCh. 19 - Prob. 42PCh. 19 - Prob. 43PCh. 19 - Prob. 44PCh. 19 - Carri and Dane, ages 34 and 32, respectively, have...Ch. 19 - Prob. 46PCh. 19 - Prob. 47PCh. 19 - Prob. 48PCh. 19 - Prob. 49PCh. 19 - Prob. 50PCh. 19 - Prob. 51PCh. 19 - Prob. 52PCh. 19 - Prob. 53PCh. 19 - Prob. 54PCh. 19 - Prob. 55PCh. 19 - Prob. 56PCh. 19 - Prob. 57PCh. 19 - Prob. 1RPCh. 19 - Prob. 2RPCh. 19 - Prob. 3RPCh. 19 - Prob. 6RPCh. 19 - Prob. 8RPCh. 19 - Prob. 1CPACh. 19 - Ryan is 39 years old and works as a real estate...Ch. 19 - Prob. 3CPACh. 19 - Prob. 4CPA
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