Podcast
Questions and Answers
What happens if someone does not take their first Required Minimum Distribution (RMD) for the year they turn 70½?
What happens if someone does not take their first Required Minimum Distribution (RMD) for the year they turn 70½?
- They must take two RMDs the following year.
- They must take their first RMD by April 1 of the following year. (correct)
- They are exempt from taking an RMD forever.
- They lose all potential tax benefits from their retirement accounts.
What is the tax implication of repaying loans from a 401k?
What is the tax implication of repaying loans from a 401k?
- Loans are repaid with after-tax dollars. (correct)
- The loan amount is tax-exempt.
- Loans are repaid with pre-tax dollars.
- Loans are tax-deductible.
What happens if an employee does not repay a loan taken from their workplace retirement plan within 60 days of leaving their job?
What happens if an employee does not repay a loan taken from their workplace retirement plan within 60 days of leaving their job?
- The loan is forgiven.
- The loan is automatically rolled over to an IRA.
- The loan amount is returned to the retirement account.
- The loan amount is considered a distribution. (correct)
How is a borrower in the 25% tax bracket affected when repaying a loan from a 401k?
How is a borrower in the 25% tax bracket affected when repaying a loan from a 401k?
What is the consequence of not repaying a loan from a workplace retirement plan within 60 days of leaving employment?
What is the consequence of not repaying a loan from a workplace retirement plan within 60 days of leaving employment?
How many RMDs must be taken in the year following the year an individual turns 70½?
How many RMDs must be taken in the year following the year an individual turns 70½?
What tax bracket example is given in the text to illustrate the impact of repaying a loan from a 401k?
What tax bracket example is given in the text to illustrate the impact of repaying a loan from a 401k?
If a borrower who took a loan from their workplace retirement plan is under 59 and a half years old and fails to repay it within the required timeframe, what penalty might they face?
If a borrower who took a loan from their workplace retirement plan is under 59 and a half years old and fails to repay it within the required timeframe, what penalty might they face?
What happens if a borrower leaves their job without repaying a loan taken from their workplace retirement plan?
What happens if a borrower leaves their job without repaying a loan taken from their workplace retirement plan?
'Double taxation' in the context of repaying loans from 401ks refers to what process?
'Double taxation' in the context of repaying loans from 401ks refers to what process?
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