Roberto has just opened a 401k)retirement plan.The money he invests in this plan will reduce Roberto's present taxable income.

Question

Quizplus · Accepted Answer

Contributions made to a traditional 401(k) plan are not subject to immediate income tax, which reduces an individual's taxable income in the present. However, taxes on the contributions and their earnings are paid when they are withdrawn during retirement.

Roberto Has Just Opened a 401k)retirement Plan