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Federal Tax Law: Retirement Plans, Pensions, and Annuities #290926

Course Overview

Credit

Amount

CPA

3.5

CFP^®

CDFA^®

IAR/FINRA

EA / OTRP

ERPA

Course Author: Paul J. Winn CLU ChFC Field of Study (CPA): Taxes Field of Study (CFP): Tax Planning Field of Study (CDFA): Tax Field of Study (IAR): Product & Practice Field of Study (EA/OTRP): Federal Tax Law Field of Study (ERPA): Qualified Retirement Plan Matters

Course Description

Course publication/revision date: This course was updated on 2/12/2026 (covers 2026 taxes).

Retirement Plans, Pensions and Annuities is a course that discusses the federal income tax treatment of, and limitations related to a) qualified employee plan contributions and distributions, and b) commercial annuity contracts. It examines the qualified plan limits and income taxability of: employer and employee contributions (including designated Roth account contributions); plan loans; life insurance contained in the plan; plan distributions, including distributions as periodic payments and non-periodic payments; required minimum distributions; and rollovers. The course also examines the tax treatment of lump-sum distributions and periodic payments received under commercial annuity contracts.

Table of Contents

Introduction1

Chapter 1 – Qualified Retirement Plans2

Introduction	2
Chapter Learning Objectives	2
Defined Benefit Plans	2
Defined Benefit/401(k) Plans	3
Defined Contribution Plans	3
Individual Participant Accounts Characterize Defined Contribution Plans	4
Target Benefit Plans	5
Target Benefit Plan Investment Risk	5
Target Benefit Plans Favor Older Plan Participants	5
Profit Sharing Plans	6
Traditional Profit Sharing Plans	6
Age-Based Profit Sharing Plans	6
401(k) Plans	6
403(b) Tax Sheltered Annuity Plans	7
Multiple Employer Plans for Tax Sheltered Annuity 403(B) Plans	8
Simplified Employee Pension (SEP)	8
SEPs for Domestic Employees	8
Savings Incentive Match Plan for Employees (SIMPLE)	9
Roth Contributions to SEPs & SIMPLEs	9
Starter 401(k) & 403(b) Plans Authorized	10
Small Financial Incentives to Encourage Plan Participation	10
Tax Credits for Small Employers – Military Spouse Employment & Accelerated Plan Eligibility	10
Summary	11
Chapter Review	12

Chapter 2 – Tax Treatment of Qualified Plans13

Introduction	13
Chapter Learning Objectives	13
Contributions to Qualified Employee Plans	13
Employer Plan Contributions	13
Defined Benefit Plan Limit on Deductible Employer Contributions	13
Defined Contribution Plan Limit on Deductible Employer Contributions	14
Retroactive Individual 401(k) Elective Deferrals for Sole Proprietors	14
Employee Plan Contributions	15
403(b) Plan Contribution Limit Increased for Long-Service Employees	15
Catch-up Contributions for Participants Age 50 or Older	16
Designated Roth Accounts	16
Student Loan Payments Treated as Elective Deferrals for Employer Match	16
Qualified Student Loan Payment	17
Certain SIMPLE Contribution Limits Increased	17
Life Insurance in a Qualified Employee Plan	18
Requirements for Plan Life Insurance	18
Life Insurance Premiums	18
Qualifying Longevity Annuity Contract Changes	19
Distributions from a Qualified Employee Plan	19
Cost Basis in a Qualified Employee Plan	19
How Benefits are Distributed	19
Lump Sum Plan Distributions	19
Plan Distributions as Periodic Payments	20
Fully Taxable Periodic Payments	20
Partly Taxable Periodic Payments	20
Figuring the Tax-Free Part of Periodic Payments – Simplified Method	20
Figuring the Tax-Free Part of Periodic Payments – General Rule	23
Early Distributions	24
Qualified Disaster Distribution	25
Repaying Qualified Birth or Adoption Distributions	25
Exemption from Tax Penalties for Premature Distributions by Terminally Ill	25
Premature Distribution Tax Penalty at Age 50 for Private Sector Firefighters Eliminated	25
Simplifying Hardship Distributions	26
Modifying the Premature Distribution Tax Penalty for Public Safety Officers	26
Modification of Premature Distribution Tax Penalty to Other Eligible Government Employees	26
Emergency Expense Withdrawals	26
Emergency Expense Withdrawal Limitations	27
Amount Distributed may be Repaid	27
Limitation on Subsequent Emergency Distributions	27
Domestic Abuse Distributions	27
Involuntary Plan Distribution Limit Increased	28
403(b) Hardship Distribution Rules Eased	28
Required Minimum Distributions	28
Lifetime Distribution Requirements for Designated Roth Accounts Eliminated	28
Plan Distributions of Non-Cash Assets	29
Rollovers	29
Distributions Ineligible for Rollover	30
Direct and Indirect Rollovers	30
Qualified Disaster Distribution Repayments	31
Plan Loans	31
Specific Repayment Term Required	31
Substantially-Level Amortization Required	32
Maximum Loan Amount Limited	32
Loan Agreement Required	32
The SECURE Act 2.0 Plan Loan Changes	32
Death Benefits	32
Roth Account Distributions	33
Qualified Roth Distributions Tax-Free	33
Nonqualified Roth Account Distributions	33
Summary	34
Chapter Review	35

Chapter 3 - Annuities37

Introduction	37
Chapter Learning Objectives	37
Deferred Annuity	37
Immediate Annuity	37
Qualified Annuity	37
Nonqualified Annuity	37
Death Benefits	38
Annuitization Methods	38
Temporary Annuity	38
Life Annuity	38
Nonqualified Annuity Income Tax Treatment	39
Premiums	40
Cash Values	40
Ownership by Non-natural Persons Generally	40
Ownership by Natural Persons and Certain Trusts	40
Surrenders and Withdrawals	40
Charges Against Cash Value for LTC Premiums not Currently Taxable	41
Annuity Loans	41
Premature Distributions	41
Annuity Payments During Lifetime	42
Fixed Annuities	42
Variable Annuities	43
Annuitant's Death After Annuity Starting Date	43
Contract Owner's Death Before Annuity Starting Date	43
Estate Taxation of Annuities	43
Summary	43
Chapter Review	44

Answers to Chapter Review Quizzes46

Chapter 1	46
Chapter 2	47
Chapter 3	49

Glossary51

Index54

Course Details

Author: Paul J. Winn CLU ChFC

Paul J. Winn CLU ChFC — Financial Writer, Editor & Trainer. Education: B.A., St. John’s University (1961–1964); Law School, University of Virginia (1964–1965); MBA program Binghamton University (1986–1989); CLU (1985); ChFC (1987). Experience: Thirty years in the life insurance and investment industry (1965–1995). Thirty-one years as a financial writer, editor and trainer (1995–2026). Paul held positions at Mutual Life Insurance Company of New York as product developer and compensation officer; at Security Mutual Life Insurance Company as general agent, marketing vice president, and agency vice president; at Principal Financial Group as agency manager; and as president of Maryland Financial Corporation, managing a financial adviser corporation providing tax, investment and financial planning. As a writer and editor, Paul is a published book author whose books include Tax Planning from the Heart, Business Succession Planning, and Dominating Obamacare. He served as writer and editor of a major mutual life insurance company’s agent training university, created more than 200 insurance, securities and tax training courses in online, print and scripted classroom formats, and is the founder and CEO of Winn Publications LLC, a tax and insurance continuing education course licensor.

Publication/Revision Date: 2/12/2026

Course Exam Questions (online): 20 (multiple-choice)

Program Delivery Method: Self-Study (NASBA QAS Self-Study)

Available Formats of Course Text: Downloadable PDF, Printed/Mailed

Course Level, Prerequisites, and Advance Preparation Requirements

License	Course Level	Prerequisites	Advance Preparation Requirements
CPA	Overview	None	None
CFP®	Intermediate	Familiarity with federal taxation	None
CDFA®	Intermediate	Familiarity with federal taxation	None
IAR	Intermediate	Familiarity with federal taxation	None
EA/OTRP	Overview	None	None
ERPA	Overview	None	None

* This program is appropriate for professionals at all organizational levels.

Sponsor ID Numbers

National Registry of CPE Sponsors I.D.: 107615

CFP Board Sponsor I.D.: 1008 — Course I.D.: 195519

Registered with the Institute for Divorce Financial Analysts

NASAA Sponsor I.D.: S17460 — Course I.D.: C82046

IRS Qualified Sponsor I.D.: FWKKO

EA/OTRP Course I.D.: FWKK0-T-00740-26-S

ERPA Course I.D.: FWKK0-Q-00741-26-S

State CPA Board Sponsor ID Numbers (where applicable)

Florida Division of Certified Public Accounting: 0004761

Hawaii Board of Public Accountancy: 14003

New York State Board for Public Accountancy: 002146

Ohio Accountancy Board: CPE .51 PSR

Pennsylvania State Board of Accountancy: PX178025

Texas State Board of Public Accountancy: 009349

Learning Objectives

As a result of studying the course material, you should be able to meet the objectives listed below:

Distinguish between the types of qualified employee plans;
Recognize the limits imposed on qualified employee plan contributions and benefits;
List the requirements applicable to qualified employee plan loans;
Apply the federal tax laws to qualified employee plan contributions and distributions;
Recognize the changes made to retirement plans and pensions by the SECURE Act and the CARES Act;
Recognize the tax treatment of nonqualified annuity distributions; and
Identify the tax treatment of annuity contributions and distributions.

Online Book, Online Exam

$39.00

Hardcopy Book, Online Exam

$51.00