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.
- 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
Correct Answer
A. 1099 RExplanation
1099 R is Ithe IRS form with which individual reports his or her distributions from annuities, profit-sharing plans, retirement plans, IRAs, insurance contracts and/or pensions.Rate this question:
-
- 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
Correct Answer
C. RMDExplanation
RMD 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.Rate this question:
-
- 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
Correct Answer
B. November 1Explanation
The default for RMD is to send an annual check on November 1st each year.Rate this question:
-
- 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
Correct Answer
A. TrueExplanation
Not only will the insured get an initial RMD notice to set it up, but they will also get an annual withholding reminder for RMD. This letter simply states that it is their right to change the federal withholding election.Rate this question:
-
- 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
Correct Answer
B. Death ClaimsExplanation
The spousal continuation can be done when the annuitant passes away the spouse can take over ownership of the policy only if the spouse is listed as the sole primary beneficiary on the policy. This whole process is handled through the claims department.Rate this question:
-
- 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
Correct Answer
B. FalseExplanation
On an FPDA there is an 8-year surrender charge period and grades down to 0% starting in year 9 and going forward.Rate this question:
-
- 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
Correct Answer(s)
A. Death of Annuitant or owner
B. Terminal illness of Annuitant
C. Confinement in a long term care facility of the annuitantExplanation
We will waive full surrender charges if the annuity is annuitized by the owner after one year and for a minimum 10-year payout.Rate this question:
-
- 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
Correct Answer
B. FalseExplanation
Only the interest credited after the date you make the request is available for systematic withdrawal.Rate this question:
-
- 9.
You can take systematic payments of a fixed amount even if you are in the surrender charge period.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
You can only take systematic withdrawals after you are out of the surrender charge period.Rate this question:
-
- 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
Correct Answer
A. TrueExplanation
If the insured is taking Interest Only withdrawals in the surrender period they cannot also take a 10% preferred withdrawal.Rate this question:
-
- 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
Correct Answer
B. FalseExplanation
Systematic withdrawals can be started or stopped at any time, subject to policy provisions and IRS regulations. This is unlike annuitized policies as you cannot stop payments once the first payout has begun.Rate this question:
-
- 12.
What is the Supplementary Contract Request Form number?
- A.
EFL-741
- B.
EFL-930
- C.
EFL-7514
- D.
EFL-2332
Correct Answer
B. EFL-930Explanation
EFL-930 is the Supplementary Contract Request Form.Rate this question:
-
- 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.
Correct Answer
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.Explanation
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.Rate this question:
-
- 14.
Box 1 of the 1099 R is for the total gross distributions.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Box 1 of the 1099 R is where the insured will be able to see the gross distributions.Rate this question:
-
- 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.
Correct Answer
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.Explanation
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.Rate this question:
-
- 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.
Correct Answer
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.Explanation
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.Rate this question:
-
Quiz Review Timeline +
Our quizzes are rigorously reviewed, monitored and continuously updated by our expert board to maintain accuracy, relevance, and timeliness.
-
Current Version
-
Nov 16, 2023Quiz Edited by
ProProfs Editorial Team -
Nov 12, 2013Quiz Created by
Frank07171983
Back to top