Examples of Qualified Contracts in a sentence
Qualified Contracts may have additional restrictions on naming and changing Beneficiaries.
Each additional Purchase Payment must be at least $250 for Non-Qualified Contracts and $50 for Qualified Contracts.
Certain Owners of Qualified Contracts may borrow against their Contracts.
In addition, various tax-qualification rules for Qualified Plans specifically limit increases in benefits once RMDs begin, and Qualified Contracts are subject to such limits.
Certain Qualified Contracts may require distributions to occur at an earlier age.
Unlike Non-Qualified Contracts, Qualified Contracts are subject to federal penalty taxes not just on premature distributions, but also on excess contributions and failures to make required minimum distributions (“RMDs”).
For Qualified Contracts that permit loans, the Loan Account Value as of the end of any Business Day is the Loan Account Value on the prior Business Day, increased by any: • interest; plus • Contract Value loaned on that day; and decreased by any: • loan principal repaid; plus • earned interest transferred from the Loan Account on that day.
The tax rules applicable to Qualified Contracts and Qualified Plans, including restrictions on contributions and distributions, taxation of distributions and tax penalties, vary according to the type of Qualified Plan, as well as the terms and conditions of the Plan itself.
For non-periodic amounts from certain Qualified Contracts or Plans, Code Section 72(e)(8) provides special rules that generally treat a portion of each amount received as a tax-free recovery of the “investment in the contract,” based on the ratio of the “investment in the contract” over the Contract Value at the time of distribution.
This provision is available for Tax Qualified Contracts if agreed to by Us.