2. KDT, Inc. would like to establish a qualified retirement plan to benefit its

Question

2. KDT, Inc. would like to establish a qualified retirement plan to benefit its 95 full-time employees. (KDT does not have any other employees.) KDT would like to fund the plan with cash each year and does not want to make contributions to the plan in years that the company does not have a profit. Given this information, and considering the employee census data, the best qualified retirement plan for KDT would be a cash balance pension plan.

3.Desk Town, Inc. has employees located in offices and stores in Houston, Philadelphia, and Buffalo. Desk Town would like to establish a qualified retirement plan for its employees in the Houston and Philadelphia offices only. It has already completed initial testing and has determined that its plan will meet the coverage tests while excluding Buffalo because none of the employees in the Buffalo office meet the eligibility requirements of the plan. However, Desk Town must still notify the employees located in the Desk Town Buffalo offices and stores of its establishment of the qualified retirement plan.

4.A plan sponsor has the right to terminate a qualified retirement plan when the plan sponsor no longer has the funds available to continue funding the plan at a reasonable level.

5.Contributions to SIMPLE plans predominantly consist of employer contributions.

6.Rock, age 28, terminated employment with Stone Brothers on April 30, 2013. Before terminating employment Rock had earned $25,000 of compensation and deferred $6,000 to the SIMPLE sponsored by Stone Brothers. If during the remaining months of 2013 Rock earns $40,000 from his new employer who sponsors a 401(k) plan, Rock may defer up to $17,500 of the $40,000 of compensation to their 401(k) plan.

7.Otto is a participant in his employer-sponsored 401(k) plan during part of the year. Later in the year, Otto becomes a participant in his new employer

Explanation / Answer

7.Otto is a participant in his employer-sponsored 401(k) plan during part of the year. Later in the year, Otto becomes a participant in his new employer

Related Questions

Navigate

• Browse (All)
• Browse 2
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.