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Which of the following statements concerning the allowance of loans from qualified plans is correct?

A. Loan provisions are commonly included in defined-benefit pension plans to allow participants to access their benefits prior to retirement.

B. Loan provisions are not permitted to be used in ESOPs because the plan is required to invest primarily in employer stock.

C. A loan provision may be helpful in enticing employees to participate in a 401(k) plan so the actual deferral percentage test can be passed.

D. Profit-sharing plans frequently use loan provisions to provide participants with a means to get around the restriction against in-service withdrawals.

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Category:- Basic Finance
Reference No.:- M9215201

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