At the time of his death,Jacque was a participant in Ivory Corporation's qualified pension plan and group term life insurance.The balance in his pension plan is:

The term insurance has a maturity value of $100,000.All amounts are paid to Penny,Jacque's daughter.One result of these transactions is:

Question

At the time of his death,Jacque was a participant in Ivory Corporation's qualified pension plan and group term life insurance.The balance in his pension plan is:

The term insurance has a maturity value of $100,000.All amounts are paid to Penny,Jacque's daughter.One result of these transactions is:

Quizplus · Accepted Answer

Penny must pay income tax on $1,300,000 [$900,000 (employer's contributions)+ $400,000 (plan earnings)].Jacque's contributions ($500,000)and the insurance proceeds ($100,000)are not subject to income tax.Jacque's gross estate includes $1,900,000 ($900,000 + $500,000 +$400,000 + $100,000).

At the Time of His Death,Jacque Was a Participant in Ivory