Angie's Employer Has a Qualified Pension Plan

question 33

Multiple Choice

Angie's employer has a qualified pension plan. The employer makes all payments into the plan; employees do not contribute to the plan. During the current year, the employer pays $5,000 into the plan on Angie's behalf. Which of the following statements is true?
I.Angie is not taxed on the $5,000 in the current year.
II.The $5,000 payment is excluded from her income in the current year, but she will pay tax on the $5,000 as she receives it.
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• A)Only statement I is correct.
• B)Only statement II is correct.
• C)Both statements are correct.
• D)Neither statement is correct.

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