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Which statements concerning taxation of qualified pension

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Reference no: EM132936315

Problem 1: All of the following statements concerning taxation of qualified pension plans are correct EXCEPT:

A. Employees do not have to report employer contributions for retirement benefits as taxable income until distributed.

B. If retirement plan payments are being made on a non-lifetime basis, each payment is multiplied by an exclusion ratio to determine tax-free and taxable amounts.

C. In determining the exclusion ratio, an employee's cost basis will not be reduced in the form of payment indicates a refund feature.

D. Disability benefits will be taxed in accordance with the annuity rules of IRC Section 72.

E. If an employee has no cost basis in a plan, periodic retirement payments will be totally subject to tax as ordinary income.

Reference no: EM132936315

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