IRAs,and 401(k)and 403(b)plans
A)impose added taxes on those who save.
B)place no limits on the amount people can deposit into these programs.
C)impose penalties for withdrawals except under certain circumstances.
D)None of the above is correct.

Question

Quizplus · Accepted Answer

IRAs, 401(k), and 403(b) plans typically impose penalties for withdrawals before an individual reaches age 59 1/2 except for certain circumstances such as disability or financial hardship. This is done to encourage long-term saving and discourage early withdrawals which could impact retirement savings.