Answered

Which of the following situations would allow funds to be deposited into a rollover IRA?

A. An employee quits her job and receives [tex]$50,000 from her qualified plan.

B. A family receives $[/tex]1,000,000 in a wrongful death lawsuit.

C. An individual receives a [tex]$100,000 inheritance.

D. A policyowner surrenders his life insurance policy's $[/tex]25,000 cash value.



Answer :

GinnyAnswer

Final answer:

Funds can be deposited into a rollover IRA when an employee quits her job or when an individual receives an inheritance.


Explanation:

Rolling over funds into a rollover IRA can occur when an employee quits her job and receives money from her qualified plan. This money can then be deposited into a rollover IRA to maintain the tax-advantaged status.

Additionally, if an individual receives an inheritance, those funds could also be deposited into a rollover IRA. However, the other scenarios mentioned, such as a wrongful death lawsuit settlement or surrendering a life insurance policy, do not typically allow for the funds to be deposited into a rollover IRA.


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