Pension Tag > Posts tagged "Pension"

Can my employer change the 401k plan or make an exception for me?

Generally, no. The federal regulations that govern 401k plans require that 401k plans do not discriminate against employees. Plans must have uniform rules and the rules must apply in a uniform manner. For example, if your plan permits hardship withdrawals it must establish specific rules for those distributions. Plans can establish some variances in rules across different business units, but once the rules become effective they cannot change without amending the entire plan. In order to make an exception or change the rules, the plan has change for everybody. Even when a 401k plan desires to make a change, changes often require amending...

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What is the difference between a 401k plan and a deferred compensation plan? Dallas employee benefits lawyer explains

Generally, both plan formats defer compensation because the employee has elected to defer taking cash in hand to obtain some additional benefit, such as deferring taxes on the money or investing on a tax deferred basis. Under more specific legal definitions, there is a distinction between how these different plans work. Today's post will discuss some of the key differences between these types of employer-sponsored retirement plans through the eyes of an employment law attorney. 401k plans and ERISA 401k plans are governed by the Employee Retirement Income Security Act (ERISA) along with other defined contributions plans like ESOPs. They must be available to...

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How does the 10% penalty on IRA and 401k distributions work?

Many people, especially after leaving a job, make the decision to cash out their 401k accounts. Sometimes people end up in a financial hardship where they need to liquidate retirement savings early. These distributions are almost always taxable (qualified Roth and after-tax money is not); but for most people under age of fifty-nine and a half, there is an additional 10% penalty. Taking a taxable distribution from a 401k, IRA, or pension When you take a taxable distribution from a 401k, pension, or IRA account, that is ordinary income and computed as part of your taxable income for the year. Not only...

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What is a KSOP? Explained by a Dallas Employment Attorney

KSOP is jargon used within the financial and employee benefit industries as shorthand to explain the arrangement where a 401k plan houses an ESOP of the employer’s stock as an investment option. An ESOP is an Employee Stock Ownership Plan that allows employees to purchase company stock through a retirement plan. It is an ERISA plan all on its own but also an investment option within a 401k plan along with the other common 401k investment options. What is a KSOP retirement savings plan? KSOP structures became popular among employers as a way of offering company stock without having to offer employees...

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