Problem
The tax consequences associated with a qualified plan include the following:
Question options:
1) Code Sec. 415 imposes limits on the amount that may be contributed by an employee's account each year.
2) The employee is not taxed on the contributions to the plan, but must pay tax on the income from the account as it is earned.
3) The employee is not taxed on contributions to the plan when made; thus, the employer receives no deduction at the time of the contribution.
4) Contributions must be made by the tax year-end and the aggregate amount that an employer may deduct for contributions made during the year is limited.