Pension Setup and Administration

Are you paying a large amount each year in benefits to retain key employees? We can analyze your current package to see if it’s competitive.

Important Pension Questions when establishing a Defined Benefit Plan, Pension Plan or 401(k) Plan


Plan Administration Questions –

How many employees need to become eligible before the owners become top heavy, and need to add a new employee to the DB side of the plan?

What is the minimum age required for an otherwise eligible employee to become eligible? Is there a range (can the plan set the minimum to 25 years of age)?

Is the profit sharing aspect of the plan is flexible? Can you explain how flexible it is, and how that works?

What is the maximum number of vesting years that can be established for the 3% profit sharing aspect of the plan?

Is the 3% profit sharing funding required in a down year (a year with small or no profits)? What is the range/threshhold for profit for there to be exceptions to this requirement?

Is it true that the 3% profit sharing contributions (for a given year) can be funded by 09/15 of the following year, and still be deducted for that tax year?

What is the minimum number of hours that an employee can work during the year and still be eligible for that year?

Should the 3% profit sharing contributions be funded to a pooled account due to vesting requirements?

Is it true that the 401(k) and 3% safe harbor contributions need to be funded within 7 days of the employee’s paycheck date?

Under what circumstances can the pension be frozen? How long can it remain frozen without having to be closed?

Are there any funding requirements (retroactive or otherwise) during the period in which the plan is frozen?

Plan Investment Questions –

Will the employees 401(k) and safe harbor funds be able to be established in to individual accounts (for each employee), with individual online access?

Is there an additional cost to the plan for that service level? If yes, is there a lower service level, and what is the difference in cost? Is there a per employee cost?

In the future, if an employee needs to take out a 401(k) loan, does your company handle those documents and that process with them?