SIE Exam Question 858: Answer and Explanation

Question: 858

For a defined contribution plan, annual contributions to an employee's account are limited to the lesser of __________ of compensation or __________ in 2021.

• A. 20%, $19,000
• B. 20%, $25,000
• C. 25%, $58,000
• D. 25%, $225,000

Correct Answer: C

Explanation:

For a defined contribution plan, annual contributions to an employee's account are limited to the lesser of 25% of compensation or $58,000 in 2021.