What is the tax consequence for employers providing qualified pension contributions? Contributions are deductible as made. Contributions are not deductible until the employee withdraws them. Contributions are taxed at the time of provision. Employers receive no tax deduction for contributions. SUBMIT
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Step 1: Restate the question and define terms — The question asks about the tax consequence for employers who make contributions to a qualified pension plan (a tax-qualified retirement plan meeting legal requirements). Show more…
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All the following are correct statements regarding the tax advantage of qualified pension plans EXCEPT: A. Investment income earned on pension plan assets is tax deferred. B. An employee may be in a lower tax bracket when distribution is received. C. Under limited circumstances, distributions from pension plans may be taxed on a favorable basis. D. There is no current income tax to the employee on employer contributions to a pension plan. E. An unlimited business expense deduction is allowable on employer contributions to a pension plan.
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