Which of the following retirement plans is considered tax-qualified?

A defined contribution plan is considered tax-qualified because it meets the requirements set forth by the Internal Revenue Service (IRS) under the Employee Retirement Income Security Act (ERISA). These plans, which include 401(k) plans and profit-sharing plans, provide tax advantages to both employers and employees. Contributions made to these plans are typically made on a pre-tax basis, meaning that employees do not pay income tax on the contributions until they withdraw them in retirement. Additionally, the earnings on investments within these plans also grow tax-deferred until distribution.

Other options, while they may be tax-advantaged in various ways, are not classified explicitly as defined contribution plans. A traditional IRA, for instance, has its own set of rules regarding contributions and tax benefits but is categorized separately from defined contribution plans. Similarly, a Simplified Employee Pension (SEP) plan is a type of traditional IRA designed for self-employed individuals or small business owners, and while it is also tax-advantaged, it is not the same as a defined contribution plan. The Roth IRA, on the other hand, has different tax implications; contributions are made after-tax, and qualified distributions are tax-free, which distinguishes it further from defined contribution plans.

Understanding the nature and classification of