IRA Compliance

Question 1

Which IRC section explains the 10 percent early distribution penalty tax and the various exceptions to this penalty tax?

Answer 1

IRC Sec. 72(t)

Question 2

Which IRC section outlines the general rules for RMDs and beneficiary distribution options?

Answer 2

IRC Sec. 401(a)(9)

Question 3

Which IRC section details the rules specific to Roth IRAs?

Answer 3

IRC Sec. 408A

Question 4

Which IRC section explains the rules for rolling over employer-sponsored retirement plan assets to IRAs?

Answer 4

IRC Sec 402

Question 5

Which IRC section authorizes the deductions allowed for certain types of IRA contributions? This section also prescribes the contribution limits for annual Traditional and Roth IRA contributions.

Answer 5

IRC Sec. 219

Question 6

Which IRC section outlines the general rules applying to IRAs?

Answer 6

IRC Sec. 408

Question 7

Which source document is the primary source of rules governing IRAs?

Answer 7

Internal Revenue Code

Question 8

Which source document is the IRS’ response to an IRA owner’s specific written request (the response may be relied on only by the IRA owner who made the request)?

Answer 8

Private Letter Rulings

Question 9

Which source document is issued by the IRS to provide immediate information?

Answer 9

Announcements and Notices

Question 10

Which source document is the IRS’ interpretation of the Internal Revenue Code?

Answer 10

Treasury Regulations

Question 11

Which source document is an in-depth interpretation of a particular section of the Internal Revenue Code or Treasury Regulations as applied to a specific set of facts?

Answer 11

Revenue Rulings

Question 12

Which source document is guidance from the IRS that focuses on procedures and administrative matters?

Answer 12

Revenue Procedures

Question 13

Which source document is an explanation of IRA rules in layman’s terms?

Answer 13

IRS Publications

Question 14

Which source document is a list of IRA rules and procedures that are not available elsewhere?

Answer 14

IRS Forms and Instructions

Question 15

Which types of IRAs may be offered by financial organizations? Which may not?
HSAs
Simple IRAs
Coverdell ESAs
Roth IRAs
Traditional IRAs

Answer 15

Yes: Simple IRAs, Roth IRAs, Traditional IRAs
No: HSA & Coverdell ESAs

Question 16

According to Publication 590-A, when does the 60-day period for determining an eligible rollover begin?

Answer 16

60th day after the day you RECEIVE the distribution from your Traditional IRA or your employer’s plan.

Question 17

What is a private letter ruling?

Answer 17

The IRS reviews a specific individual’s case.

Question 18

Who may rely on a private letter ruling?

Answer 18

Only the individual to which the private letter ruling pertains.