In: Finance
If you are a screenwriter for Hollywood you likely are a part of the Screenactors Guild Union. This Union has billions of dollars set-aside for retirement money in a pension. The pension often buys real estate investments as a part of its investment strategy. Identify the nature of this capital transfer.
Group of answer choices
Direct transfer
Indirect transfer with financial intermediary
Indirect transfer through Investment Bank
Direct transfer
Reason :
Direct rollovers from qualified retirement plans occur when the retirement plan administrator pays the plan’s proceeds directly to another plan or IRA, often in the form of a check. In the case of a 60-day rollover, funds from a retirement plan or IRA are paid directly to the investor, who must deposit the funds in another retirement plan or IRA within 60 days to avoid penalty.
Examples of qualified retirement plans include:
The Internal Revenue Service (IRS) provides a guide to common qualified plan requirements. In general, qualified retirement plans meet the requirements of Internal Revenue Code Section 401(a) and are thus eligible to receive certain tax benefits. They usually come in two forms: the defined benefit plan, and the defined contribution plan. A cash balance plan is a hybrid of these two.
Taxes are typically not paid when performing a direct rollover or trustee-to-trustee transfer. However, distributions from a 60-day rollover and funds not rolled over are typically taxable.