Final answer:
The required federal tax withholding on a benefits payment eligible for a rollover that is made directly to a plan participant is 20%. The correct option is d. 20%
Step-by-step explanation:
The answer to the question 'If a benefits payment is made directly to a plan participant and is eligible for a rollover, what percentage of the benefit payment is the trustee required to withhold for federal tax?' is d. 20%. This rate is the standard federal withholding rate for eligible rollover distributions from a retirement plan (such as a 401(k)) that the participant chooses to take as cash instead of rolling it over into another qualified retirement plan or IRA. It is crucial for participants to be aware of this withholding to make informed decisions about their retirement distribution options.
The correct option is d. 20%