QKA PRACTICE EXAM ACTUAL
2025/2026 QUESTIONS AND 100%
CORRECT ANSWERS
/. Determine the max elective deferral in 2021
age:35
Compensation: 50,000
only contributions are elective deferrals - Answer-✅19,500
participants may defer up to the LESSER of 19,5000 or 100% of compensation
catch-up contributions may only be made by participants who are age 50 (6,500)
/.Dianne has recently started employment with a new company and wants to roll over
her balance (entirely pretax) from her prior employers 401k plan into her new employers
401k plan.
What rules apply to the rollover - Answer-✅Plan provisions do not have to allow
rollovers
rollovers of direct distributions must be completed within 60 days of distribution
there is no tax with holding on direct rollovers
place that accept rollovers may but are not required to accept loans as part of rollover
/.Rother earnings may be distributed tax free - Answer-✅if the 5 year holding period has
been met
or
death, disability, or attainment of 59 1/2
/.What is the latest date an employer can cash out unused vacation time for a
terminated participant and have it count as compensation for deferral purposes -
Answer-✅the LATER of 2 1/2 months after severance or the end of the limitation year in
which employment terminated may be deferred against if the plan provision allows
/.Plan is a calendar year allows max deferral amount and catch up contributions
participant is 55
, compensation 100,000
what is the max elective deferral? - Answer-✅Elective deferrals are both pre-tax and
Roth deferrals
for those under 50, its the LESSER of 19,500 or 100% of compensation
Those over 50 may contribute another 6,500
This persons max is 26,000
/.Discretionary nonelective employer contributions - Answer-✅a plan can require all
participants be employed at the end of the plan year in order to receive an allocation
if plan imposes hours of service, anyone who reached 1000 hours must be credited
many plans waive the allocation requirements for disable participants
/.Elective deferrals, after tax contributions, all employer contributions, and forfeitures are
- Answer-✅Annul additions.
/.Limit is the LESSER of a participants 415 compensation or statutory dollar limit for the
year - Answer-✅Annual Additions limit
/.Integration level cannot be more than - Answer-✅100% TWB
/.TWB is the wages taken into account to - Answer-✅determine social security benefits.
The collection of Social Security benefits does not impact the level of plan benefits
/.100 TWB or 20% of TWB what percentage do you use? - Answer-✅5.7%
/.Cross testing allocation method is not a designed based - Answer-✅safe harbor
allocation
/.nondiscrimination testing must be performed every year to demonstrate - Answer-
✅that allocation do not discriminate in favor of HCEs
/.the gateway test is only required to be satisfied if a plan wants to - Answer-✅test
allocations for nondiscrimination using cross testing
/.what are the 2 ways to satisfy the gateway test - Answer-✅each NHCE an allocation
for least 5% of IRC 415 compensation
or
2025/2026 QUESTIONS AND 100%
CORRECT ANSWERS
/. Determine the max elective deferral in 2021
age:35
Compensation: 50,000
only contributions are elective deferrals - Answer-✅19,500
participants may defer up to the LESSER of 19,5000 or 100% of compensation
catch-up contributions may only be made by participants who are age 50 (6,500)
/.Dianne has recently started employment with a new company and wants to roll over
her balance (entirely pretax) from her prior employers 401k plan into her new employers
401k plan.
What rules apply to the rollover - Answer-✅Plan provisions do not have to allow
rollovers
rollovers of direct distributions must be completed within 60 days of distribution
there is no tax with holding on direct rollovers
place that accept rollovers may but are not required to accept loans as part of rollover
/.Rother earnings may be distributed tax free - Answer-✅if the 5 year holding period has
been met
or
death, disability, or attainment of 59 1/2
/.What is the latest date an employer can cash out unused vacation time for a
terminated participant and have it count as compensation for deferral purposes -
Answer-✅the LATER of 2 1/2 months after severance or the end of the limitation year in
which employment terminated may be deferred against if the plan provision allows
/.Plan is a calendar year allows max deferral amount and catch up contributions
participant is 55
, compensation 100,000
what is the max elective deferral? - Answer-✅Elective deferrals are both pre-tax and
Roth deferrals
for those under 50, its the LESSER of 19,500 or 100% of compensation
Those over 50 may contribute another 6,500
This persons max is 26,000
/.Discretionary nonelective employer contributions - Answer-✅a plan can require all
participants be employed at the end of the plan year in order to receive an allocation
if plan imposes hours of service, anyone who reached 1000 hours must be credited
many plans waive the allocation requirements for disable participants
/.Elective deferrals, after tax contributions, all employer contributions, and forfeitures are
- Answer-✅Annul additions.
/.Limit is the LESSER of a participants 415 compensation or statutory dollar limit for the
year - Answer-✅Annual Additions limit
/.Integration level cannot be more than - Answer-✅100% TWB
/.TWB is the wages taken into account to - Answer-✅determine social security benefits.
The collection of Social Security benefits does not impact the level of plan benefits
/.100 TWB or 20% of TWB what percentage do you use? - Answer-✅5.7%
/.Cross testing allocation method is not a designed based - Answer-✅safe harbor
allocation
/.nondiscrimination testing must be performed every year to demonstrate - Answer-
✅that allocation do not discriminate in favor of HCEs
/.the gateway test is only required to be satisfied if a plan wants to - Answer-✅test
allocations for nondiscrimination using cross testing
/.what are the 2 ways to satisfy the gateway test - Answer-✅each NHCE an allocation
for least 5% of IRC 415 compensation
or
