QUESTION 1 For which reason does the IRS use the term "key employees"? top-heavy provisions in employer-sponsored qualified retirement plans QUESTION 2 In theory, the CEO hires the consultant to perform an objective analysis of the company's executive pay package and to make whatever recommendations the consultant feels are appropriate; however, in practice, …
BUS409WK10Q9 1) What does the IRS use the term "key employees" for? A) for non-discrimination rules in retirement benefits B) for non-discrimination rules in health insurance benefits C) to determine the necessity of top-heavy provisions in employer-sponsored qualified retirement plans D) to determine the necessity of top-heavy provisions in employer-sponsored …
BUS 409 Week 10 Quiz 9 1) What does the IRS use the term "key employees" for? 2) The IRS considers Sylvia to be a highly compensated employee for Beautiful Pictures, Inc., which means she has at least one of which of the following qualifications in the preceding year? 3) Which of the following are the two main components of current core compensation?
Dec 03, 2018 · Response Feedback: Good work Question 2 3 out of 3 points For which reason does the IRS use the term "key employees"? Selected Answer: top-heavy provisions in employer-sponsored qualified retirement plans Correct Answer: top-heavy provisions in employer-sponsored qualified retirement plans.
The purposes are: To ascertain the correctness of any return; To prepare a return where none has been made; To determine the liability of a person for any internal revenue tax; To determine the liability at law or in equity of a transferee or fiduciary of a person in respect of any internal revenue tax;
The third party is required to assemble the records and prepare to produce them on the date specified in the summons, whether or not a petition to quash has been or will be filed. IRC § 7609 (i) (1).
IRC § 7601 authorizes the Service to inquire about any person who may be liable to pay any internal revenue tax. The authority under 7601 to inquire does not include the authority to summon.
district court to quash the summons no later than twenty days after the day notice of the summons is given. IRC § 7609 (b) (2).
The First Amendment to the Constitution guarantees the right of free expression; this includes the right to assemble freely; freedom of the press; freedom of religion; and freedom of speech.
In general, the Service should issue summonses only when the taxpayer (or other witness) will not produce the desired records or other information voluntarily. A summons is specific to the case for which it is issued.
Third Party. Any person served with a summons other than the taxpayer being examined or investigated or an officer, employee, agent, accountant, or attorney of a taxpayer who , at the time the summons is served, is acting as such officer, employee, agent, accountant, or attorney. Third-Party Records.
There is also a limit on the number of individuals who can be key employees based on officer status. The maximum number is the greater of 3 or 10% of the number of employees, but in no event can there be more than 50 officers treated as key employees.
An HCE is any employee who meets either an ownership test or a compensation test at any time during the plan year in question or in the immediately preceding plan year. Ownership test: An employee is an HCE based on ownership if he or she owns more than 5% of the company sponsoring the plan at any time during ...
Retirement plans are required to satisfy a series of nondiscrimination tests that are designed to ensure that benefits are provided proportionately to a broad-based group of employees and not just to the sponsoring company’s so-called highly compensated employees and/or key employees. That means one of the first steps in designing a plan ...
A plan sponsor has the option to include a special provision in its plan that limits the number of people who can be HCEs based on compensation to no more than 20% of its workforce. If the company has 40 employees, 10 of whom receive pay in excess of the HCE limit, adding the so-called Top Paid Group election would mean that only the 8 highest-paid employees (40 total x 20%) would be treated as HCEs. Of course, some adjustments to the employee count are needed before applying the 20% limitation, but this gives you the gist of how the rule works.#N#It’s not a foregone conclusion that the Top Paid Group election will yield more favorable results. If the lower-paid HCEs make significant contributions, then moving them into the NCHE category via this election generally helps the test. However, if some in that group defer little or nothing, it might make more sense to keep them as HCEs.
One of the more common forms of attribution is among family members. For instance, if an individual owns 100% of a company, his or her spouse, children, grandparents, and parents are all attributed that ownership and are also deemed to own 100% of the company.
Compensation Test: An employee is an HCE based on compensation if he or she was actually paid more than a set dollar limit ($130,000 for 2020 and $125,000 for 2019) from the company in the immediately preceding year. This dollar limit is indexed for inflation in $5,000 increments.
The attribution rules require that one person’s or company’s direct ownership must sometimes be attributed to another person or company. One of the more common forms of attribution is among family members. For instance, if an individual owns 100% of a company, his or her spouse, children, grandparents, and parents are all attributed that ownership and are also deemed to own 100% of the company.