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Employer Matching Contribution |
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Employer matching contribution The amount, if any, a company contributes on an employee's behalf to the employee's retirement account, usually tied to the employee's own contribution. Employer Matching Contribution Money an employer offers to an employee's IRA or other retirement fund. Normally employers will offer an equal amount that the employee contributes up to a certain dollar amount or percentage of income. This is considered an employee benefit and allows a worker to save more (and accrue applicable interest) without enduring financial hardship. How to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit webmaster's page for free fun content. |
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For plan years beginning after 2007, plans that offer automatic enrollment and meet certain requirements are exempt from the usual nondiscrimination tests that apply to employees' elective deferrals and employer matching contributions. To be a qualified automatic enrollment feature, the plan must provide for either an employer matching contribution or a profit sharing contribution. This will allow employees the best of both worlds: Although they won't get tax breaks on the money they contribute, the funds will grow and can be withdrawn tax-free and also are eligible for employer matching contributions. |
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