Employer 401 Case Study

Constructit is a company which does not presently have any employees with health insurance benefits. The company employs 1000 people and are willing to fund annual premiums as long as they can pay $4,000 per person. The employees comprise of 550 men and 450 women, ranging in ages 26 to 45. Furthermore, the workers 57% of the workers range from high activity to moderate activity while the 43% that remain are in predominantly sedentary positions. The employer must calculate what kind of risks the employee will face when considering what type of insurance to offer the employees. In this scenario, 38% of the employees are not at any major risk whatsoever.

The Additional Medicare Tax requires employers to withhold .9% of wages in excess of $200,000. These funds help fund

In order to satisfy the matching or nonelective contributions requirement employers must either meet the matching contribution requirement or make a nonelective contribution to a defined contribution plan of at least three percent of an employee’s compensation on behalf of each nonhighly compensated employee who is eligible to participate in the automatic enrollment plan. A plan normally satisfies the matching contribution requirement if the employer makes a matching contribution on behalf of each nonhighly compensated employee that is equal to 100 percent of the employee’s elective deferrals as do not exceed one percent of compensation and 50 percent of the employee’s elective deferrals as exceeds one percent but does not exceed six percent

An organization can offer several different types of retirement plans to their employees. There are two types of plans that are most often used such as the Defined Contribution Plan and the Hybrid Plans. The Define Contribution plans are beneficial not only to employees retirement needs but also beneficial to the company at the same time. Section 401(k) plans, Employee Stock Ownership Plans (ESOPs), Profit Sharing Plans, and Stock Bonus Plans. On the other broad of the spectrum we have the Hybrid Plan or the Cash Balance Plans, which may also be

a. i. An employer with a defined-contribution plan pays into the plan either an annual lump-sum per employee or calculates payments based on the employees‟ current wages and or time of service with the firm. Under such a plan, the employer does not guarantee the future amounts employees will receive when they retire. The employees covered by a defined-contribution plan assume the risk for the pension plan‟s financial performance. Under a defined-benefit plan, the employer specifies the size and timing of the payments that the employees will receive when they retire. Typically, these retirement benefits are commensurate with the wages earned by the employee in his or her last few years of employment

The current bill, the Responsible Unemployment Compensation Extension Act of 2014 also amends the earlier version of the Act of 2008. This current bill seeks to “exempt weeks of unemployment between enactment of this Act by November 30, 2014, from the prohibition in the Federal-State Extended Unemployment Compensation Act (FSEUCA) of 1970 against federal matching payments to a state for the first week in an individual's eligibility period for which extended compensation or sharable regular compensation is paid if the state law provides for payment of regular compensation to an individual for his or her first week of otherwise compensable unemployment” (Vroman, 2009). The bill also proposes several changes, some in which are (i) amendment to the Assistance for Unemployed Workers and

d. ASC 710-10-25-9 addresses the recognition of deferred compensation arrangements. It states: “To the extent the terms of a contract attribute all or a portion of the expected future benefits to a period of service greater than one year, the cost of those benefits shall be accrued over that period of the employee’s service in a systematic and rational manner.” The compensation costs associated with the stock options should be allocated over the three-year reporting period.

C. Jose – Based on the number of employees what is the best plan? And will the company add to the plan?

plan that would give employee’s vacation time as well as 12 weeks of paid family and

Comp time should be granted to exempt employees as they are not entitled to overtime. An employer may reason that exempt employees are under more stress and therefore entitled to more vacation time (Benefit Package Differences for Exempt and Non-Exempt, 2010). The compensation package should comply with federal and state rules and regulations for exempt workers. The total compensation package should operate inside the organization’s budget and financial resources. The compensation package developed should be consistent, and at the same time very accommodating. It should be flexible enough to adapt to the current trends and

A Safe Harbor Retirement Plan is a 401(k) or 403(b) plan where the company makes a specific contribution to every plan participant. Contribution options are either a flat 3% of total yearly pay to all employees who are eligible,

Keywords: S corporation insurance, payroll treatment of health insurance, multiple reimbursement arrangements of health insurance, Section 105 health reimbursement plan

As a business owner, you know that the areas of your business you focus on have a tendency to improve. With just a small amount of effort, Woita & Associates can help you focus on your company sponsored 401K. We can help you identify important questions to ask and provide data to help you make informed decisions. Learn about fees, funds, and the difference local service can make for your

These employees enjoy accrued benefit such as health insurance, vacation, Competitive wages, dental insurance, holiday and a retirement plan (Helms, 2001).

The plan provides employees options to purchase shares in the Fit Stop at a fixed price within a limited time period. (Long, 2013)