QKC Exam - ESOP || All Solved.
25% deductibility correct answers maximum deductible contribution for stock bonus plan
benefits of an ESOP correct answers -sharing of ownership in company
-tax incentives
tax incentives for ESOP correct answers -dividends may be deductible
-favorable tax treatment for distributions available
-opportunity to delay recognition of gain on sale of shares
-increased contributions
ESOP aggregation rule correct answers ESOP cannot be aggregated with other employer plans
for coverage or testing
ESOP permitted disparity rule correct answers ESOP cannot use permitted disparity allocation
formula
cash or employer stock correct answers form of allowable contributions in ESOP
prudent person rule correct answers rule ESOP is exempt from as it applies to diversification
publicly traded correct answers type of ESOP where participants are entitled to vote shares
participants votes allowed for these when rights are passed through correct answers -corporate
merger
-liquidation of company
25% deductibility correct answers maximum deductible contribution for stock bonus plan
benefits of an ESOP correct answers -sharing of ownership in company
-tax incentives
tax incentives for ESOP correct answers -dividends may be deductible
-favorable tax treatment for distributions available
-opportunity to delay recognition of gain on sale of shares
-increased contributions
ESOP aggregation rule correct answers ESOP cannot be aggregated with other employer plans
for coverage or testing
ESOP permitted disparity rule correct answers ESOP cannot use permitted disparity allocation
formula
cash or employer stock correct answers form of allowable contributions in ESOP
prudent person rule correct answers rule ESOP is exempt from as it applies to diversification
publicly traded correct answers type of ESOP where participants are entitled to vote shares
participants votes allowed for these when rights are passed through correct answers -corporate
merger
-liquidation of company
