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1.
If your employer matches your contributions to your Roth 401(k), those employer contributions are _______.
Pre-tax. Despite the Roth 401(k)'s purpose, these matches are actually pre-tax; but when you withdraw them, they will be taxed.
2.
In a starter 401k, who may make contributions to the plan?
Employees only. In the starter 401k, only employees may make contributions. This helps to keep the plan easier to administer.
3.
Who may deduct 401(k) contributions on their income tax returns?
Employers. Only the employers may deduct contributions to a 401(k) plan--employee contributions are not reported as taxable income when deducted.
4.
If an employee defers 8 percent of his or her wages into a 401(k) plan, and the employer contributes an additional 3 percent, the employer is making a matching contribution.
True. The employer is making a matching contribution.
5.
If you do a 401(k) rollover by removing and depositing the money yourself, you will be required to withhold some of the funds for taxes.
True. You must withhold 20% for taxes.
6.
There are situations in which a 401(k) rollover may result in you having to pay taxes.
True. If you don't roll over all of it, or if you don't place the funds into the new account within 60 days, you can be taxed on the amount that is not rolled over.
7.
Distributions from a 401(k) plan are allowed for all of the following except _______.
First-time home purchase. Distributions are not allowed for a first-time home purchase.