Hector's employer has a qualified pension plan to which it contributes 6% of his gross salary. Hector's current annual salary is $50,000. The pension plan also earns $2,500 during the current year on contributions made to the plan on behalf of Hector. What is Hector's gross income from these transactions for the current year?

Question

Quizplus · Accepted Answer

Employer contributions to a qualified pension plan and the earnings on those contributions are not included in an employee's gross income for the year they are made or earned. Hector's gross income remains his salary of $50,000.

Hector's Employer Has a Qualified Pension Plan to Which It