Which of the following statements is not correct?

A) The U.S.income tax code influences pension fund contributions.
B) The U.S.income tax code creates incentives for firms to overfund their pension plans.
C) The earnings from pension fund investments are taxable to the pension plan sponsor.
D) Firms with larger union memberships tend to have higher pension funding ratios.

U.S. Income Tax Code

The body of laws and regulations that govern how individuals, businesses, and other entities are taxed by the federal government of the United States.

Pension Fund Contributions

Payments made into a pension fund by employers, employees, or both, intended to finance future benefit payments to retirees.

Pension Plan Sponsor

The entity, typically a company or employer, that sets up and maintains a pension plan for the benefit of its employees.