SIE Exam Practice Question 795
Question: 795
Which of the following is/are correct regarding profit sharing plans?
(1) Profit sharing plans are a type of defined contribution pension plan.
(2) The minimum funding standard requires the employer to make an annual contribution.
Correct Answer: D
Explanation:
A profit sharing plan is a type of defined contribution plan other than a pension plan. Contributions must be substantial and recurring, but are not required annually.
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