Quiz: Disbursement Rules For Annuities! Trivia

16 Questions | Total Attempts: 449

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Quiz: Disbursement Rules For Annuities! Trivia

Quiz: disbursement rules for annuities! Disbursement rules for annuities are put in place to ensure that someone is not shortchanged when it comes to getting your money. It is therefore important that one check what each type of annuity offers on maturity either you risk to lose your money or gain more. Either you will be paid in lump sum or in bits. Take the quiz and see what you know about the techniques through which annuities are paid.


Questions and Answers
  • 1. 
    ____________ is the IRS form with which individual reports his or her distributions from annuities, profit-sharing plans, retirement plans, IRAs, insurance contracts and/or pensions.
    • A. 

      1099 R

    • B. 

      5498

    • C. 

      1099 INT

    • D. 

      W-4P

  • 2. 
    _______________ is the amount that Traditional, SEP and SIMPLE IRA owners and qualified plan participants must begin distributing from their retirement accounts by April 1 following the year they reach age 70.5.
    • A. 

      SEP

    • B. 

      SIMPLE

    • C. 

      RMD

    • D. 

      1099 R

  • 3. 
    If the RMD letter is not sent back to set up initial RMD when will the annual default check be sent?
    • A. 

      April 15

    • B. 

      November 1

    • C. 

      October 31

    • D. 

      November 15

  • 4. 
    The insured will get an RMD withholding reminder each year to give them an option to change the federal withholding election.
    • A. 

      True

    • B. 

      False

  • 5. 
    If the annuitant passes away the spouse can take over ownership on the policy only if the spouse is listed as the sole primary beneficiary on the policy. What department would handle this process?
    • A. 

      P and C

    • B. 

      Death Claims

    • C. 

      Underwriting

    • D. 

      Office of the President

  • 6. 
    On an FDPA, there is an 8-year surrender charge period. At the start of the 8th year, there is no surrender charge.
    • A. 

      True

    • B. 

      False

  • 7. 
    Check all the ways that we will waive full surrender charges.
    • A. 

      Death of Annuitant or owner

    • B. 

      Terminal illness of Annuitant

    • C. 

      Confinement in a long term care facility of the annuitant

    • D. 

      Annuitization by the owner after one year and for a minimum 5-year payout

  • 8. 
    Only the interest credited before the date you make the request for Interest Only withdrawals is available for systematic withdrawal.
    • A. 

      True

    • B. 

      False

  • 9. 
    You can take systematic payments of a fixed amount even if you are in the surrender charge period.
    • A. 

      True

    • B. 

      False

  • 10. 
    If the insured is taking Interest Only withdrawals in the surrender period they cannot also take a 10% preferred withdrawal.
    • A. 

      True

    • B. 

      False

  • 11. 
    Systematic withdrawals can be started or stopped at any time, subject to policy provisions and IRS regulations. This is also true with annuitized policies.
    • A. 

      True

    • B. 

      False

  • 12. 
    What is the Supplementary Contract Request Form number?
    • A. 

      EFL-741

    • B. 

      EFL-930

    • C. 

      EFL-7514

    • D. 

      EFL-2332

  • 13. 
    When is the RMD letter sent on existing policies?
    • A. 

      Notification is sent by January 31st of the current year to all policy owners who will attain age 70 by December 31st of the current year.

    • B. 

      Notification is sent by January 31st of the current year to all policy owners who will attain age 59 1/2 by December 31st of the current year.

    • C. 

      Notification is sent by January 31st of the current year to all policy owners who will attain age 70 ½ by December 31st of the current year.

    • D. 

      Notification is sent by January 31st of the current year to all policy owners who will attain age 68 1/2 by December 31st of the current year.

  • 14. 
    Box 1 of the 1099 R is for the total gross distributions.
    • A. 

      True

    • B. 

      False

  • 15. 
    Joint and survivor life income benefits with ____% continuing to the survivor.
    • A. 

      Payments will be made as long as either the annuitant or the joint annuitant is alive. upon the death of either annuitant, payments will continue at the specified percent of the original amount. payments continue for the lifetime of the survivor.

    • B. 

      Payments will be made for the period selected. payments will cease at the end of the guaranteed period. the payment amount is based on the guarantee period selected.

    • C. 

      Payments will be made as long as the annuitant is alive. upon the annuitant’s death, payments will cease. the amount of each payment is based on the annuitant’s sex and age at the time the option is selected.

    • D. 

      Payments will be made for the specified guaranteed period. if the annuitant is living at the end of the guaranteed period, payments will continue until the annuitant’s death. the payment amount is based on the guaranteed period and the annuitant’s sex and age at the time the option is selected.

  • 16. 
    Joint and survivor life income benefits with ____ years guarantee (specificity between 10 and 30 years) and  ____% continuing to the survivor.
    • A. 

      Guaranteed income benefits for a fixed period of ___ years

    • B. 

      Payments in the amount selected will be made for a guaranteed period. payments will cease at the end of the guaranteed period. the length of the guaranteed period will depend upon the fixed amount selected.

    • C. 

      Payments will be made as long as either the annuitant or the joint annuitant is alive. upon the death of either annuitant, payments will continue at the specified percent of the original amount. payments continue for the lifetime of the survivor

    • D. 

      Payments will be made for the specified guaranteed period and for as long thereafter as either the annuitant or the joint annuitant is alive. following the guaranteed period, payments will continue at the original amount as long as both the annuitant and the joint annuitant are alive. if only one annuitant is alive at the end of the guaranteed period or upon the death of either annuitant after the guaranteed period, payments will continue at the specified percent of the original amount. payments continue for the lifetime of the survivor.

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