Valuable Information on 401ks, Pensions, ESOPs, Form 5500 Preparation + More

2019 Retirement plan limits released

The cost-of-living adjustments (COLA) for the 2018 tax year are out. These rates released by the IRS are used to adjust various tax provisions from the standard deduction and personal exemption to retirement plan limits. Here’s a comparison of the 2019 and 2018 retirement plan limits for 401(k), 403(b) and profit sharing plans: Why there are …

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Spousal consent for retirement plan changes

Many retirement plans require plan participants to obtain spousal consent prior to several events, including change of beneficiary, distributions and loans. Typically, the plans that most frequently require spousal consent for these changes are defined benefit plans, commonly known as pension plans. Defined contribution plans, such as IRAs or 401ks, may also require consent. Change …

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Form 5500: What you need to know

Form 5500 is an annual return/report that employee benefit plans are required to file with the Department of Labor’s (DOL) Employee Benefit Security Administration (EBSA) division. Employee benefit plans subject to Employee Retirement Income Security’s Act (ERISA) standards are required to file Form 5500 on an annual basis. This report serves to satisfy necessary disclosures, …

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401(k) Pre-tax or roth contribution: which is better?

When it comes to making decisions on your 401(k) contributions, there can be a lot of different factors that make it difficult to ensure you are making the right choices. One of those choices can be deciding whether to make pre-tax contributions into a traditional 401(k) or after-tax contributions to a Roth 401(k). Pre-tax contributions …

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Fiduciary responsibilities for an employee benefit plan

Many companies offer retirement plans, which is both rewarding and challenging. Managing a plan requires certain actions and involves certain responsibilities that make the person or entity performing them a fiduciary. Fiduciaries play an essential role and are subject to standards of conduct because they act on behalf of the participants. Their responsibilities include: Acting …

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Employer match options for your 401(k) plan

Receiving an employer match for your 401(k) is a great perk and encourages employees to participate in the 401(k) programs available. There are several different types and they can differ in timing, amount, restrictions and how they are calculated. Safe Harbor match Safe Harbor is a type of match in which employees are immediately 100% …

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What is a hardship distribution from your 401(k)?

One type of distribution your 401(k) may allow for is a hardship distribution, and while the criteria can vary from plan to plan, most are generally similar. A hardship distribution is used to satisfy the immediate and heavy financial need of the participant, the participant’s spouse or the participant’s non-spouse, non-dependent beneficiary. Common examples of …

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Is a 401(k) loan a good idea? When you should and shouldn’t borrow

When employee benefit plan participants find themselves in tough financial positions, they often look for ways to relieve their financial burden. One of the options is taking out a loan from your 401(k) plan. However, is this a good idea? The answer – it depends on the situation. For most people, the idea of taking …

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How to locate your old 401(k)

If you have contributed to a 401(k) at a former employer or think that you may have done so, you probably want to find your account. Maybe you switched jobs or moved and lost track of your funds. Not to worry. Your money is protected and should still be out there. Here are several steps …

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Asset allocation: the basics for investors

The investing landscape has changed dramatically over the years. Rather than calling a stockbroker to place an order, most investors now login to their e-broker to place an order. Instead of investing in expensively managed funds, many investors now choose to invest in passively managed exchange-trade funds (ETFs). A broader range of securities is available …

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