This document discusses various types of employer-provided retirement plans and individual retirement accounts. It covers defined benefit plans, defined contribution plans like 401(k)s, deferred compensation, traditional and Roth IRAs, and retirement options for self-employed individuals. Key details include contribution and benefit limits, tax treatment of contributions and distributions, vesting schedules, and eligibility requirements. The learning objectives are to understand and calculate the tax implications of these various retirement savings vehicles.
A deferred compensation plan works very similarly to a 401(k) retirement plan; some important differences are
explained here.
Learn more - http://gt-us.co/15LyvkI
Rollovers: the impact it can have on your retirementAndrew Leeman
While leaving your money in your former employer's plan may be an option, one way to gain more control of your assets is to consolidate your retirement funds into a single individual retirement account (IRA). Email me with any questions: aleeman@ft.newyorklife.com
The term “fringe benefit” refers to any benefit provided to
an employee that is in addition to money. All benefits provided
to an employee are taxable unless the law specifically
excludes or defers tax on the benefit.
If an individual, partnership, estate, trust, or an S corporation
engages in an activity that is not conducted as a
for-profit business, expenses (other than cost of goods sold)
are not deductible. This rule does not apply to corporations,
other than S corporations. If an activity is considered
a for-profit business, deductions can exceed income, allowing
the resulting loss to offset other income.
Employee Benefits and Human Resources: The Year in Review and a Look at What’...Winston & Strawn LLP
2016 included significant legislative, regulatory, enforcement, and case law developments in the employee benefits and human resources area, and 2017 promises to be a year of change. Therefore, it is important to stay up-to-date on the latest legal developments, threats, and best practices.
Steve Flores and Christine Matott from our Employee Benefits & Executive Compensation Practice, Rob Newman and Alessandra Swanson from our Privacy & Data Security Practice, and Cardelle Spangler from our Labor & Employment Practice, reviewed important compliance deadlines and areas of potential risk. The discussion examined the following important areas:
Significant plan fiduciary litigation
DOL Conflict of Interest Rules
Affordable Care Act developments, including reporting and enforcement
Updates on HIPAA enforcement, including the latest on OCR’s audits, recently released guidance, and case settlements
Recent changes to employee privacy laws, including state breach notification laws and EU data transfer laws
New overtime rules, EEOC LGBT protections, and ban the box rules
AALU Washington Report: Death Benefit Only Plans - Fulcrum Partners LLCFulcrum Partners LLC
Death Benefit Only plans can offer a simple and flexible option for providing benefits to attract or retain key employees. Learn more about who DBO plans benefit and how to implement them, as well as taxation benefits and concerns in this AALU Washington Report published by Fulcrum Partners LLC.
A deferred compensation plan works very similarly to a 401(k) retirement plan; some important differences are
explained here.
Learn more - http://gt-us.co/15LyvkI
Rollovers: the impact it can have on your retirementAndrew Leeman
While leaving your money in your former employer's plan may be an option, one way to gain more control of your assets is to consolidate your retirement funds into a single individual retirement account (IRA). Email me with any questions: aleeman@ft.newyorklife.com
The term “fringe benefit” refers to any benefit provided to
an employee that is in addition to money. All benefits provided
to an employee are taxable unless the law specifically
excludes or defers tax on the benefit.
If an individual, partnership, estate, trust, or an S corporation
engages in an activity that is not conducted as a
for-profit business, expenses (other than cost of goods sold)
are not deductible. This rule does not apply to corporations,
other than S corporations. If an activity is considered
a for-profit business, deductions can exceed income, allowing
the resulting loss to offset other income.
Employee Benefits and Human Resources: The Year in Review and a Look at What’...Winston & Strawn LLP
2016 included significant legislative, regulatory, enforcement, and case law developments in the employee benefits and human resources area, and 2017 promises to be a year of change. Therefore, it is important to stay up-to-date on the latest legal developments, threats, and best practices.
Steve Flores and Christine Matott from our Employee Benefits & Executive Compensation Practice, Rob Newman and Alessandra Swanson from our Privacy & Data Security Practice, and Cardelle Spangler from our Labor & Employment Practice, reviewed important compliance deadlines and areas of potential risk. The discussion examined the following important areas:
Significant plan fiduciary litigation
DOL Conflict of Interest Rules
Affordable Care Act developments, including reporting and enforcement
Updates on HIPAA enforcement, including the latest on OCR’s audits, recently released guidance, and case settlements
Recent changes to employee privacy laws, including state breach notification laws and EU data transfer laws
New overtime rules, EEOC LGBT protections, and ban the box rules
AALU Washington Report: Death Benefit Only Plans - Fulcrum Partners LLCFulcrum Partners LLC
Death Benefit Only plans can offer a simple and flexible option for providing benefits to attract or retain key employees. Learn more about who DBO plans benefit and how to implement them, as well as taxation benefits and concerns in this AALU Washington Report published by Fulcrum Partners LLC.
IntroductionComment by Exploring Series This is listed as a Head.docxvrickens
Introduction Comment by Exploring Series: This is listed as a Heading 2, but it should be Heading 1. Please change this heading to a Heading 1 style.
It is never too early to save for your retirement. For a start, you can estimate the amount that you need to have before you can retire comfortably using financial calculators found on sites such as CNN Money, Kiplinger, Motley Fool, and TIAA-CREF financial services. The good part is, there are many different types of retirement plans that you can participate, individually or with your employers. To help you save for retirement, there are many government-regulated and government-approved retirement accounts that you can contribute a certain amount to annually. Why should you enroll in a retirement plan NOWnow? Did you know that your retirement can last for 30 years or more? A common rule to follow is that a retiree will need up to 80% of his/her annual income today to retire comfortably. Unfortunately, the average benefit amount paid monthly by the Social Security Administration is only $1,177.
Below are many advantages why you should start saving NOWnow:
· Tax on employee and employer contributions is deferred until distributed.
· Investment gains in the plan are not taxed until distributed.
· Retirement assets can be carried from one employer to another.
· Contributions can be made easily through payroll deduction.
· Saver’s Credit is available.
· Flexible plan options are available.
· Better financial security at retirement.
Future Retirement Savings Value - Assuming 6% annual return Comment by Exploring Series: You need to insert a caption for this table and the next table.
Monthly Savings
5 years
15 years
20 years
$50
$3,506
$14,614
$23,218
$200
$14,024
$58,456
$92,870
$500
$35,059
$146,136
$232,176
Source: http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-Benefits-of-Saving-Now
A contribution is defined as the amount that an employee and an employer can put into a retirement plan. There are, however, varying limits on how much we (including both employers and employees) can contribute to any of the retirement plan. Each plan has its own rules and criteria, and must specifically state that contributions or benefits cannot exceed certain limits. Employees can participate in contributions via salary reduction. Employers can match employees’ contributions or contribute outright a certain amount into the employees’ retirement account.
Traditional Individual Retirement Arrangements (IRAs) Comment by Exploring Series: Please change all headings formatted with Heading 3 to Heading 2 style.
There are two major kinds of IRAs – traditional and Roth. A traditional IRA is a way to save for retirement that gives you tax advantages. It allows you to make tax-deferred investments to provide financial security when you retire. Your traditional IRA contributions may be tax-deductible. The deduction may be limited if you or your spouse is covered by a retirement pla ...
COVID-19: The Impact on Retirement PlansCBIZ, Inc.
As COVID-19 continues to impact the stock market and organizations around the world, we understand that you have concerns about how recent market fluctuations may affect your retirement plan. What you should know is that there are options you may have to minimize these effects on your business and your employees. We’ve developed a summary of these complex issues in this whitepaper. You will learn about:
- Impacts to both defined benefit plans and defined contribution plans
- Potential options for your organization to minimize negative effects on your business and your employees
- Legislative updates from the CARES Act
- Important considerations and actions to take next
Michael Silver & Company CPAs recently published an article on retirement plans for businesses. Whether you have a small, independent business or a large company, we discuss the advantages and disadvantages for each plan available.
Michael Silver & Company CPAs has recently published an article on the benefits of retirement plans. Whether you have a small, independent business or a large company, we describe the advantages and disadvantages of each possible plan for each possible business.
Discuss the tax consequences of qualified pension or profit sharing pl.docxwviola
Discuss the tax consequences of qualified pension or profit sharing plan to the employee, the employer, and the trust. (source needed)
Solution
Qualified retirement plans give employers a tax break for the contributions that they make for their employees.
Qualified plans that allow employees to defer a portion of their salaries into the plan also reduce employees\' present income tax liability by reducing taxable income.
These planshelp employers to attract and retain good employees.
Qualified pans come in two types:defined benefit and defined contribution. Defined benefit plans give employees a guaranteed payout, and place the risk on the employer to save and invest appropriately to meet plan liabilities.
Under defined contribution plans, the amount employees receive on retirement depends on how well they save and invest on their own during their working years A 401 ( k) plan is an example of a defined contribution plan.
Whether the plan makes use of a trust or is funded by employer purchased annuities, an employee is generally not taxed until the amounts are distributed or made available to him. To prohibit plan participants from using plans as a mechanism for passing wealth on to the next generation, rather than as a source of income during retirement, Internal Revenue Service regulations require plan participants to take required minimum distributions from qualified plans once they reach the required beginning date described in the regulations.
The trust must be valid under State Law and a ll beneficiaries of the trust must be individuals, and the trust must be irrevocable by its terms upon the participant\'s death.
.
An introduction to the cryptocurrency investment platform Binance Savings.Any kyc Account
Learn how to use Binance Savings to expand your bitcoin holdings. Discover how to maximize your earnings on one of the most reliable cryptocurrency exchange platforms, as well as how to earn interest on your cryptocurrency holdings and the various savings choices available.
LA HUG - Video Testimonials with Chynna Morgan - June 2024Lital Barkan
Have you ever heard that user-generated content or video testimonials can take your brand to the next level? We will explore how you can effectively use video testimonials to leverage and boost your sales, content strategy, and increase your CRM data.🤯
We will dig deeper into:
1. How to capture video testimonials that convert from your audience 🎥
2. How to leverage your testimonials to boost your sales 💲
3. How you can capture more CRM data to understand your audience better through video testimonials. 📊
Implicitly or explicitly all competing businesses employ a strategy to select a mix
of marketing resources. Formulating such competitive strategies fundamentally
involves recognizing relationships between elements of the marketing mix (e.g.,
price and product quality), as well as assessing competitive and market conditions
(i.e., industry structure in the language of economics).
3.0 Project 2_ Developing My Brand Identity Kit.pptxtanyjahb
A personal brand exploration presentation summarizes an individual's unique qualities and goals, covering strengths, values, passions, and target audience. It helps individuals understand what makes them stand out, their desired image, and how they aim to achieve it.
The 10 Most Influential Leaders Guiding Corporate Evolution, 2024.pdfthesiliconleaders
In the recent edition, The 10 Most Influential Leaders Guiding Corporate Evolution, 2024, The Silicon Leaders magazine gladly features Dejan Štancer, President of the Global Chamber of Business Leaders (GCBL), along with other leaders.
Personal Brand Statement:
As an Army veteran dedicated to lifelong learning, I bring a disciplined, strategic mindset to my pursuits. I am constantly expanding my knowledge to innovate and lead effectively. My journey is driven by a commitment to excellence, and to make a meaningful impact in the world.
At Techbox Square, in Singapore, we're not just creative web designers and developers, we're the driving force behind your brand identity. Contact us today.
Event Report - SAP Sapphire 2024 Orlando - lots of innovation and old challengesHolger Mueller
Holger Mueller of Constellation Research shares his key takeaways from SAP's Sapphire confernece, held in Orlando, June 3rd till 5th 2024, in the Orange Convention Center.
Tata Group Dials Taiwan for Its Chipmaking Ambition in Gujarat’s DholeraAvirahi City Dholera
The Tata Group, a titan of Indian industry, is making waves with its advanced talks with Taiwanese chipmakers Powerchip Semiconductor Manufacturing Corporation (PSMC) and UMC Group. The goal? Establishing a cutting-edge semiconductor fabrication unit (fab) in Dholera, Gujarat. This isn’t just any project; it’s a potential game changer for India’s chipmaking aspirations and a boon for investors seeking promising residential projects in dholera sir.
Visit : https://www.avirahi.com/blog/tata-group-dials-taiwan-for-its-chipmaking-ambition-in-gujarats-dholera/
Building Your Employer Brand with Social MediaLuanWise
Presented at The Global HR Summit, 6th June 2024
In this keynote, Luan Wise will provide invaluable insights to elevate your employer brand on social media platforms including LinkedIn, Facebook, Instagram, X (formerly Twitter) and TikTok. You'll learn how compelling content can authentically showcase your company culture, values, and employee experiences to support your talent acquisition and retention objectives. Additionally, you'll understand the power of employee advocacy to amplify reach and engagement – helping to position your organization as an employer of choice in today's competitive talent landscape.
2. 13-2
Learning Objectives
1. Describe the tax and nontax aspects of employer-
provided defined benefit plans from both the
employer’s and employee’s perspective.
2. Explain and determine the tax consequences
associated with employer-provided defined
contribution plans, including traditional 401(k) and
Roth 401(k) plans.
3. Describe the tax implications of deferred
compensation from both the employer’s and
employee’s perspective.
3. 13-3
Learning Objectives
4. Determine the tax consequences of traditional and
Roth Individual Retirement Accounts and explain
the differences between them.
5. Describe the retirement savings options available
to self-employed taxpayers and compute the
limitations for deductible contributions to
retirement accounts for self-employed taxpayers.
6. Compute the saver’s credit.
4. 13-4
Employer Provided Plans
Qualified Plans
Must not discriminate between employees
Two main types:
Defined benefit plan
Defined contribution plan
5. 13-5
Defined Benefit Plans
Standard benefits based on fixed formula
Average compensation
Years of service
Employers deduct liability as they contribute
to plan
Funding requirements based on actuarial
assumptions
Employer not employee bears investment risk
6. 13-6
Defined Benefit Plans
Vesting schedules
5-year cliff or
7-year graded
Distributions from defined benefit plans are
taxable to employee when received.
Ordinary income
Early distributions subject to 10% penalty
7. 13-7
Defined Contribution Plans
Employer specifies up-front contribution on
employee’s behalf
Employers typically match employee contributions
Employees may contribute to plan
Employees choose how to invest contributions
Alternatives depend on employer’s plan
401(k), 403(b), and 457
8. 13-8
Defined Contribution Plans
Annual contribution limits for 2011
Employee contributions
$16,500 if not 50 years of age by year end
$22,000 if at least 50 years old by year end
Employer + Employee contributions
Limited to lesser of $49,000 ($54,500 if at least 50
years old at end of year) or 100% of the
employee’s compensation.
9. 13-9
Defined Contribution Plans
Vesting
Employee contributions and earnings on
employee contributions
Vest immediately.
Employer contributions and earnings on employer
contributions
Minimum vesting requirements
3-year cliff or
6-year graded schedule.
11. 13-11
Defined Contribution Plans
Distributions
Distributions are ordinary income
Early distributions subject to a 10% penalty
Before 59 ½ year of age if still working or
Before 55 years old and separated from service
(retired)
12. 13-12
Defined Contribution Plans
Required minimum distributions
For the year in which employee reaches age 70 ½
or when the employee retires, if later (and each
subsequent year)
May defer first required distribution to April 1 of next
year, otherwise distribution must be received by
December 31 of current year
Based on applicable percentage of balance at end
of prior year
50% penalty on undistributed portion of minimum
distribution requirement.
13. 13-13
Traditional 401k Plans
Contributions are made with before-tax
dollars.
Tax deductible
Distributions:
Same rules as other defined contribution plans
14. 13-14
Roth 401k Plans
Contributions made with after-tax dollars.
Not tax deductible
Employer contributions must go into a
traditional 401k plan (not a Roth 401k plan)
15. 13-15
Roth 401k Plans
Qualified distributions
After account open for five years and employee
has reached age 59 ½.
Non-qualified distributions
Distributions of earnings are taxable and
subject to 10% penalty
Distributions from contributions are not taxable
Contributions divided by account balance multiplied
by amount of distribution equals distribution from
contributions
16. 13-16
Deferred Compensation
“Nonqualified plans”
May discriminate
Generally provided to executives or highly
compensated rather than rank and file
Can be used to make employee’s whole
when contributions to qualified plans would
be limited
Deemed investment choices
Risks to employees electing to defer salary?
17. 13-17
Deferred Compensation
Employer deducts for tax purposes when
pays
Compare to financial accounting
Employee includes in income when
received
If paid after retirement, §162(m) limitation
does not apply
18. 13-18
Deferred Compensation
Relevant variables
Employer and employee current tax rates
Employer and employee future tax rates
Employer’s cost of capital or discount rate
Employee’s cost of capital or discount rate
20. 13-20
Individual Retirement
Accounts (IRAs)
For AGI deduction for contributions
Generally not allowed if participant in employer-
sponsored plan unless
For single taxpayers Taxpayer is single, deduction
allowed if participate in employer plan but income is
below certain thresholds
In 2011, lesser of $5,000 in 2011 or earned income
If 50 years or older at end of year limit is $6,000
Additional “catch-up” contribution
21. 13-21
Individual Retirement
Accounts (IRAs)
For AGI deduction for contributions
Generally, not allowed if participant in employer-
sponsored plan unless
For married taxpayers deduction is allowed if
participate in employer plan but income is below
certain thresholds
In 2011, lesser of $5,000 in 2011 or earned income
of both spouses reduced by other spouse’s
contributions to IRA or Roth IRA
If 50 years or older at end of year limit is $6,000
Additional “catch-up” contribution
22. 13-22
Individual Retirement
Accounts (IRAs)
May make nondeductible contributions
Deductible + nondeductible cannot exceed
$5,000 for one taxpayer (plus catch-up)
Must contribute by April 15th
of
subsequent year
23. 13-23
Individual Retirement
Accounts (IRAs)
Distributions taxed as ordinary income
10% penalty if before 59 ½
Certain exceptions
Medical expenses, insurance premiums, first
home
Same minimum distributions apply as to
qualified contribution plans
nontaxable percentage = nondeductible
contributions divided by balance of account
24. 13-24
Roth IRAs
Nondeductible contributions
Contributions to a Roth IRA
Same $5,000 limit ($6,000 if 50 or older at year
end)
Phase-out based on AGI
25. 13-25
Roth IRAs
Distributions from a Roth
Distributions of contributions never taxed
Qualified distributions of earnings from Roth not taxed
Account must be open for five years before can receive
qualified distributions and
Taxpayer must be at least 59 ½ to receive qualified distribution or
Distributions on death of taxpayer or
Taxpayer is disabled or
First home (limited to $10,000)
No minimum distribution requirements
26. 13-26
Roth IRAs
Rollover from traditional to Roth
Tax consequences
Why roll over?
Marginal tax rates
Contribution limits to Roth are effectively higher
$5,000 limit of after tax vs. before-tax dollars
28. 13-28
SEP IRA
Contribution limit
Lesser of (1) $49,000 or (2) 20% of net earnings
from self employment
Must provide plan to employees if taxpayer has
employees
29. 13-29
Individual 401(k)
Contribution limit
Lesser of (1) $49,000 or (2) 20% of net earnings
from self employment + $16,500
Additional $5,500 if age by year end
Maximum contribution is $54,500 ($49,000 + $5,500)
30. 13-30
Saver’s Credit
Credit for taxpayers contributing to qualified
plans
Credit in addition to deduction for contribution
Available to lower income taxpayers
Depends on filing status and AGI