Which amount may be deposited into a rollover individual retirement account (IRA) for the purpose of deferring income taxes?
The proceeds of a life insurance policy paid to a beneficiary under age 70-1/2
The refund received by the beneficiary under a refund life annuity
The amount paid to the spouse of a deceased annuitant under a tax-sheltered annuity
The value of an IRA established by the beneficiary’s deceased parent
A rollover IRA is used to defer taxes on qualifying distributions.
Proceeds from a life insurance policy (A) are generally not eligible for tax-deferred treatment.
Refunds from a refund life annuity (B) are considered taxable income and not eligible for rollover.
Amounts paid to a spouse under a tax-sheltered annuity (C) qualify for rollover treatment because they meet IRS rollover rules for deferred taxation.
IRAs inherited from parents (D) follow different tax rules and cannot be directly rolled over into a new IRA.
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