CRPC Employer-Sponsored Retirement Plans 4

Question 1

What is the 415 limit for defined contribution plans in 2024?

Accepted Answer

$69,000

Answer

IRC Section 415 limits total annual additions to a participant's defined contribution account to $69,000 in 2024 (or 100% of compensation, if less).

Question 2

A 457(b) plan is available to which of the following employees?

Accepted Answer

State and local government employees and certain nonprofit employees

Answer

457(b) plans are nonqualified deferred compensation plans for state/local government employees and eligible nonprofit employees.

Question 3

Under the terms of ERISA, what does the term 'plan year' mean for vesting calculation purposes?

Accepted Answer

The 12-month period designated by the plan document

Answer

The plan year is a 12-month period specified in the plan document, which may or may not coincide with the calendar year.

Question 4

A participant in a defined benefit plan earns a pension benefit based on 1.5% × final average salary × years of service. This is an example of what formula type?

Accepted Answer

Final-pay formula

Answer

A final-pay formula calculates benefits using compensation in the final years before retirement multiplied by years of service.

Question 5

What is the maximum compensation that can be considered for qualified plan contribution calculations in 2024?

Accepted Answer

$345,000

Answer

The IRC Section 401(a)(17) compensation limit for qualified plan calculations is $345,000 in 2024.

CRPC - Chartered Retirement Planning Counselor Practice Test

CRPC - Chartered Retirement Planning Counselor Practice Test

CRPC Employer-Sponsored Retirement Plans 4