Jose is an employee of O'Hara Industry and earns $100,000 in 2012.The maximum amount O'Hara can contribute to a money purchase plan on behalf of Jose is
A)$15,000
B)$20,000
C)$25,000
D)$35,000
E)$40,000

Question

Quizplus · Accepted Answer

In 2012, the maximum contribution an employer could make to a money purchase pension plan on behalf of an employee was 25% of the employee's compensation, up to a maximum of $50,000. Therefore, for Jose's $100,000 salary, the maximum contribution would be 25% of $100,000, which is $25,000.

Jose Is an Employee of O'Hara Industry and Earns $100,000