Which of the following statements is (are)true with respect to profit-sharing plans?
I.There is no limit on the amount that an employer can contribute annually to an employee's account under a profit sharing plan.
II.Profit sharing plans offer greater funding flexibility for employers than under other qualified plans.

Question

Quizplus · Accepted Answer

II is true because profit-sharing plans do provide greater funding flexibility for employers compared to other qualified plans, allowing employers to adjust contributions based on profitability. I is false because there are limits on the amount an employer can contribute annually to an employee's account under a profit-sharing plan, set by the IRS.

Which of the Following Statements Is (Are)true with Respect to Profit-Sharing