Adjusted Gross Income
Definition Adjusted gross income (AGI) is the amount that is properly reflected on the last line of page 1 of IRS Form 1040 or 1040A.
401K
A tax-deferred employer-provided retirement savings account, to which eligible employees may defer part of their salary. Salary deferral can be pre-tax or post-tax include Roth 401(k)s.
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Automated Customer Account Transfer Service (ACATS)
Definition A system that facilitates the automated movement of account balances between financial institutions. Typically, the entire account balance must be moved in order for
Inheritance Tax
Definition Tax imposed on the right or privilege of receiving property from a decedent’s estate. Inheritance tax is not assessed on the property, but is
Income Averaging
Definition Also referred to as Forward Averaging Tax treatment where lump-sum distributions from qualified plans are treated as if they were distributed averagely over a
Job Creation and Workers Assistance Act of 2002 (JCWAA)
Definition Act signed into law on March 9, 2002, effecting technical changes to EGTRRA. Provisions effected by JCWAA include the following: A qualified employer plan
401(k) stock ownership plan (KSOP)
Definition An employer sponsored plan, which combines the features and benefits of an ESOP and a 401(k) plan. Employer contributions to a KSOP are usually
Keogh Plan
Definition A qualified plan established by a self-employed individual. The term can be used to refer to defined benefit plans, money purchase and other pension
Lump Sum Distribution
Definition Distribution or payment, within a single tax year, of a plan participant’s entire balance from all of the employer’s qualified pension plan, profit-sharing plan,
Loan
Definition Amount borrowed by a participant from his or her vested balance under a qualified plan , 403(b) or 457(b) plan. Loans are limited to
Life Expectancy
Definition The number of years that a participant is expected to live, as defined by regulations. Life expectancies are provided in the life-expectancy tables, which
