Which of the following statements is true regarding employer-provided qualified retirement plans?
A)May discriminate against rank and file employees.
B)Deductible contributions are generally phased-out based on AGI.
C)Executives are generally ineligible to participate in these plans.
D)They are generally referred to as defined benefit plans or defined contribution plans.See discussion in text.

Question

Quizplus · Accepted Answer

Employer-provided qualified retirement plans are generally referred to as either defined benefit plans or defined contribution plans. Option A is incorrect, as employers are not allowed to discriminate against rank and file employees. Option B is incorrect, as deductibility of contributions to these plans is based on specific limits and rules set by the IRS, not phased-out based on AGI. Option C is incorrect, as executives are generally eligible to participate in these plans, though certain limitations may apply.

Which of the Following Statements Is True Regarding Employer-Provided Qualified