Which of the Following Statements Regarding the Qualified Tuition Plans

question 32

Multiple Choice

Which of the following statements regarding the qualified tuition plans (QTP) is incorrect?

• A)Distributions can be made tax-free to pay for room and board at college.
• B)Distributions made from the QTP for college tuition will be tax-free in addition to qualifying for the American Opportunity credit or lifetime learning credit.
• C)Katie's parents had established a QTP for Katie,but she has received a "full-ride" scholarship.Katie's parents can name her sister as a replacement beneficiary of the QTP.
• D)Distributions of income not used for qualified higher education expenses are taxable and subject to a 10% penalty.

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Definitions:

Placebo Beverage

A drink given to participants in an experiment, which they believe contains active ingredients, but does not, used to measure psychological and physiological effects.

Casual Sex

Sexual activity that takes places outside the context of a serious relationship, often focusing on physical pleasure without emotional commitments or future expectations.

Alcohol

A chemical substance that is a central nervous system depressant and is consumed in beverages for its psychoactive effects, often leading to intoxication.

Women

Female human beings; also refers to issues, conditions, and perspectives specific to them, particularly in contexts of health, society, and rights.