Qualified Charitable Distribution (QCD)
Definition A distribution that is excludable from the distributee’s income, as a result of meeting the following requirements: It is made after the distributee reaches
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Saver’s Credit
Definition Also known as the Saver’s Tax Credit: Nonrefundable tax credit available to eligible individuals who make contributions to their retirement account. The saver’s credit
IRA
What does active participant mean? Find the answer here
Who is an active participant? Active participant status affects an individual’s eligibility to take a deduction for a contribution to a traditional IRA on his/her
Catch-up Contribution
Definition An additional contribution that can be made to a retirement plan by a participant who is at least age-50 by the end of the
Salary Deferral Contribution
Definition A contribution made pursuant to a participant’s election to have a portion of his/her salary/wages contributed to his/ her employer sponsored plan rather than
Highly Compensated Employee (HCE)
Definition A highly compensated employee (HCE) is any employee who — Was a 5-percent owner at any time during the year or the preceding year,
Key Employee
Definition An employee who, at any time during the plan year, is (i) an officer of the employer having an annual compensation greater than $180,000,
Applicable RMD Age
Applicable RMD Age The first year for which an IRA owner or plan participant must begin to take RMDs from their tax-deferred retirement account. RMDs
SIMPLE 401(k) Plan
Definition A SIMPLE 401(k) plan is a 401(k) plan established by a small business for it’s employees. Earnings accrue on a tax-deferred basis and distributions
Excess accumulation penalty (RMD excise tax)
Definition 50% excise tax that is applied to required minimum distribution (RMD) amounts that are not distributed from the retirement plans by the applicable deadline.
