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Retirement Intermediate: Special Types of Individual Retirement Accounts

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1.
An employer may exclude from a SIMPLE IRA any employees whose retirement benefits are covered by a union contract.
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True. Employees whose retirement benefits are covered by a union contract are excluded from participating in a SIMPLE IRA.
2.
SIMPLE IRAs may be funded by _______.
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Both employer contributions and employee salary reduction contributions. However, an employee may elect not to make a contribution.
3.
Employers are required to contribute to their employees' SEP-IRAs.
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False. Employer contributions are voluntary.
4.
SIMPLE IRAs are sponsored by whom?
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Employers. The SIMPLE IRA is an employer-sponsored retirement plan.
5.
Which of the following is required of employees who want to participate in a SIMPLE IRA plan?
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They received at least $5,000 in compensation from their employers during any two years before the present year. The earnings requirement, as you can see, is fairly easy.