Definitions & Descriptions
401(k) Plans
Today’s 401(k) Plans have become the preferred plan in the market place today. These plans typically allow employees to place untaxed wages into an account that is invested in stocks, bonds, and/or mutual funds. Employers can choose to match employee investment by any given percentage as a company benefit. There are many variations of the 401(k) Plan that outline different requirements and provide various benefits. Contact us today to learn if a 401(k) Plan is right for you.
403(b) Tax Shelter Annuity Plans
Similar to 401(k) Plans, a 403(b) Plan or Tax Shelter Annuity Plan is sponsored by non-profit organizations, such as schools and some charitable organizations. The tax advantages to 403(b) Plans are the same as with 401(k) Plans. Today, non-profit organizations are also permitted to sponsor 401(k) Plans, just like for-profit companies. You should consider all the advantages and disadvantages of each type of Plan before implementing a retirement program the best meets your goals. Contact us.
457(b) Plans
457 Plans are defined contribution plans that are available to governmental and certain non-governmental employers. Under these plans, employees defer on a per-tax basis, similar to 401(k) or 403(b) Plans. Non-governmental 457 Plans can be set up by non-profit organizations to benefit key employees. These Plans are either “eligible” 457(b) Plans, or “ineligible” 457(f) Plans, which provide savings vehicles in addition to their 401(k) or 403(b) Plans. If your organization is considering a type of 457(b) Plan, contact us.
Cash Balance Pension Plans
A cash balance pension plan is a defined-benefit pension plan maintained on an individual account basis, such that the plan acts similar to a defined-contribution plan. For business owners and partners who are looking for large tax deductions and accelerated retirement savings beyond a 401(k) Plan, a Cash Balance plan is the perfect solution. Under a Cash Balance Plan the employer credits a participant's account with a set percentage of his or her yearly compensation plus interest charges. The plan's funding limits, funding requirements and investment risk are based on defined-benefit requirements: as changes in the actual investement portfolio do not affect the final benefits to be received by the participant upon retirement or termination. For more information on whether or not a cash balance plan is right for your business, contact us.
Defined Benefit Plans
In today’s environment, a Defined Benefit Plan can fit well with small employers looking to save significant amounts for retirement. Under Defined Benefit Plans, employee benefits and retirement funds are calculated with specific formulas to identify each employee’s retirement payout figures. Items that effect employee payouts include salary history and the length of employment. The company remains responsible for investments and accumulating retirement funding. To find out if a Defined Benefit Plan is right for you, contact us today.
Defined Contribution Plans
Defined Contribution Plans fall under the Qualified Retirement Plan umbrella. Defined Contribution Plans allow for individual account balances for each employee to grow through employee salary deferrals, employer contributions, investment earnings or forfeitures. Although these plans are eligible for IRS tax breaks, Defined Contribution Plan structures are limited to parameters stipulated by the Internal Revenue Code. Despite different constraints, Defined Contribution Plans provide stable retirement funding. Contact us today to learn if a Defined Contribution Plan is the right option for you.
Employee Stock Ownership Plan
The Employee Stock Ownership Plan, or ESOP, is highly tax advantageous in the right circumstances. It works by spreading ownership of the company to employees. Tax-deductible contributions may be made to accumulate company stock, and there are many different manners in which ESOPs can operate to provide maximum value. Contact us today to learn if an ESOP is the right option for you.
GASB 45
GASB 45 is requiring all government entities (including state and local government, as well as public school districts) to account for and report the annual cost of Other Post-Employment Benefits (OPEB) in the same manner in which they report pension costs. Markley Actuarial believes in face-to-face meetings and individualized consulting to help you implement the proper required accounting changes and maximize available opportunities.
Liability Driven Investment
Fluctuating contributions and unpredictable unfunded benefit obligations may be the reason for the review of your Pension Plan. Regardless of the option that you select for the future of your Pension Plan, greater stability in contributions and obligations must be achieved. By communicating the Plan’s annual expected benefit payments to the investor, we can help coordinate solutions to achieve greater plan stability under the Pension Protection Act and current accounting rules. Contact us today.
Multi-Employer Plans
Multi-Employer Plans are typically Defined Benefit Plans maintained under collective bargaining agreements that cover the employees of more than one employer. Usually the sponsoring employers engaged in the same industry, labor union or association. These plans may be referred to as "Taft-Hartley plans". The employers and unions negotiate benefits periodically. Contact us to learn how we can support you in your next round of negotiations.
New Comparability Plans
New Comparability Plans are typically profit sharing plans that can enable a higher contribution level to be allocated to certain groups or individuals under the Plan. The Plans allow for company owners and higher paid employees to maximize their contributions while minimizing the cost of benefits for other employees. To find out if a New Comparability Plan is the right option for you, contact us today.
Non-Qualified Retirement Plans
Non-Qualified retirement plans are not regulated by the IRS and may not produce advantageous tax breaks. However, these flexible plans allow the employer more options than qualified retirement plans in how key employees are benefited over and above the traditional qualified plans. To learn if Non-Qualified Retirement Plans are right for you, contact us today.
Pension Protection Act
The Pension Protection Act represents the most dramatic change in Pension Plan funding requirements in over 30 years. We can help you prepare for the changes, by reviewing the potential options of continuing the Plan with modifications, Cash Balance Plan design, freezing or terminating the Plan. Contact us today to discuss your best option.
Prevailing Wage Plans
Often utilized in the employment fields of construction and labor, prevailing wage laws were enacted by the Davis-Bacon Act. Here at Markley Actuarial Services we can work with you to help you take advantage of the benefits these regulations have to offer. From taking hourly credit for medical costs to provisions in pensions or 401(k) plans, Markley Actuarial Services can help you find the best approach to Prevailing Wage Plans.
Profit Sharing Plans
Profit Sharing Plans are Qualified Retirement Plans that are often noted for their flexibility. Under a Profit Sharing Plan, each year the company contributes a predetermined amount to an employee’s retirement plan, which is typically tied to actual profits of the business. However, there are limits on the level of contributions that can be allocated. Contact us today to learn if a Profit Sharing Plan is the right option for you.
Qualified Retirement Plans
Qualified Retirement Plans meet specific requirements set by the Internal Revenue Code. Items needed for qualification normally circle around minimum participation numbers, and vesting and funding stipulations. The Internal Revenue Code qualification ensures advantageous tax breaks. There are a variety of retirement plans that are included under the umbrella of Qualified Retirement Plans. Markley Actuarial can help you identify which plan is best for your unique goals.