Aams Module 6 & 7 Already Passed

Internal Revenue Code limitations on defined contribution {Ans: lesser of 100% of a participant's compensation or $69,000 annually}charitable remainder trusts {Ans: Charitable remainder trusts can help increase cash flow while providing tax deductions. Property is donated irrevocably to a charitable organization via a trust that pays an annual income stream of 5% or more of the initial value (CRAT), or 5% or more of the annually reappraised value (CRUT) to a beneficiary (usually the donor and spouse) for life or a term of years. If, for example, appreciated securities are given, their full fair market value (not depleted by capital gains tax) less the value of the income interest constitutes a charitable deduction. Low-yield appreciated securities, thus, are an ideal vehicle for this technique.}letters of credit {Ans: A letter issued by a bank allowing the bearer to withdraw a specific amount of money from the bank or its branches.}Top hat plan {Ans: unfunded SERP that provides benefits to a select group of highly compensated individuals. Even though a top hat plan is unfunded, it is nevertheless subject to the reporting and disclosure requirements of ERISA, although not to other provisions}indemnity insurance {Ans: "Standard' type of