Employer sponsored retirement plan

(redirected from Employer-Sponsored Retirement Plan)

Employer Sponsored Retirement Plan

A retirement plan in which both an employer and an employee make contributions into an account each month. The contributions are invested on behalf of an employee, who may begin to make withdrawals after retirement. Typically, employer sponsored retirement plans are tax-deferred, meaning that the employee does not pay taxes on the funds in the pension until he/she begins making withdrawals. However, some plans are not tax-deferred, and, instead, employees make tax-free withdrawals. Employers are not legally required to offer retirement plans, though most major companies do. Plans may have defined contributions, defined benefits, or both. See also: 401(k), IRA.

Employer sponsored retirement plan.

Employers may offer their employees either defined benefit or defined contribution retirement plans, or they may make both types of plans available.

Any employer may offer a defined benefit plan, but certain types of defined contribution plans are available only through specific categories of employers.

For example, 403(b) plans may be offered only by tax-exempt, nonprofit employers, and 457 plans only by state and municipal governments. SIMPLE plans, on the other hand, can only be offered by employers with fewer than 100 workers.

Corporate employers who contribute to a retirement plan can take a tax deduction for the amount of their contribution and may enjoy other tax benefits. However, the plan must meet certain Internal Revenue Service (IRS) guidelines.

Offering a retirement plan may also make the employer more attractive to potential employees. However, employers are not required to offer plans. If they do, they can make the plan as generous or as limited as they choose as long as the plan meets the government's non-discrimination guidelines.

References in periodicals archive ?
Kollman brings exponential employer-sponsored retirement plan expertise to the Pinnacle Plan Design team, adding four enrolled actuaries and 23 professionals on staff to design and administer customised 401(k)/profit sharing plans and defined benefit plans to Pinnacle.
Lincoln Financial Group (NYSE: LNC) has said that its Retirement Plan Services business has upgraded its Lincoln Director employer-sponsored retirement plan programme for small business clients.
The benefits of saving in an employer-sponsored retirement plan
Three percent said their worst financial habit was "contributing to my employer-sponsored retirement plan but not taking full advantage of my employer match.
Additionally, the IRA was also intended to provide a place for transferring, or rolling over, balances from employer-sponsored retirement plans; thus giving both retiring workers and individuals who were changing jobs a way to preserve their employer-sponsored retirement plan assets.
workers do not even have access to an employer-sponsored retirement plan, largely because they work for small companies that do not sponsor such plans.
At this point, clients also should contribute to any available 401(k) account--even if there is no employer match--and to any other employer-sponsored retirement plan that allows pretax contributions.
KETRA also increases the allowable plan loan amount from an employer-sponsored retirement plan.
457 or similar employer-sponsored retirement plan, without being subject to the Sec.
The Department of Labor's Conflict of Interest Rule, if implemented in its current form, will force advisors to choose between employer-sponsored retirement plan business and traditional wealth management, according to new research from Cerulli Associates.
The Government Accountability Office (GAO) found that from 1998 to 2009, women surpassed men in their likelihood of working for an employer that offered a pension plan; however, this was largely because the percentage of men covered by an employer-sponsored retirement plan over that same period had declined.
3760, the Automatic IRA Act of 2010, introduced by Jeff Bingaman (D-New Mexico) and cosponsored by John Kerry (D-Massachusetts)--both require that companies with more than 10 workers automatically enroll their employees in a payroll-deduction IRA (known as auto-IRAs) if they are not already covered by an employer-sponsored retirement plan.

Full browser ?