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.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

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.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
References in periodicals archive ?
A profit sharing plan is a qualified, defined contribution plan featuring a flexible employer contribution provision.
Now unions, including the NSWNA, are gearing up to campaign for an increase to the employer contribution.
Eckler Partners recommended that the pensions committee, the national church group that oversees operations of the pension office, based in Toronto, consider further increasing the employer contribution rate in 2007.
The act permits plan sponsor to deduct employee 401(k) elective deferrals in addition to the employer contribution, effective for tax years beginning after December 31, 2001 (see the Exhibit).
* A nonelective employer contribution of at least 3 percent of compensation for each eligible employee who isn't highly compensated under the plan.
In addition, although the employer contribution (i.e., 80 percent of the cost of an average plan) would remain tax-free, there is no incentive to provide more costly plans, so the $46 billion currently lost to the unlimited tax-break is capped, saving an estimated $11.2 billion per year.
The survey of 284 schemes showed huge variations, with some still in surplus and requiring no employer contribution while other firms had raised their contributions by 100pc.
The survey of 559 companies showed half were totally opposed to the TUC's call for a minimum employer contribution to pension schemes of ten per cent of earnings.
Because of the small number of participants affected relative to the total and the small monetary amount relative to the total employer contribution, the failure was deemed insignificant and eligible for correction.
Employer contribution for Flagstar is 25% on first 6% of employee contributions and an additional 75% on first $500 per year of first 6%; for Denny's, 100% on first 3%.
The inferred employer contribution to fund the benefit was $9,950 per year.
Plans designed before any compensation limits were imposed frequently gave everyone an employer contribution equal to the same percentage of pay.

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