Definition of "Offset approach"

Cheryl Pryor real estate agent
Cheryl Pryor, Real Estate Agent Long & Foster

Method of integrating an employee's Social Security or other retirement benefits with a qualified retirement plan. Some employers offset (reduce) retirement or disability income benefits from an employee's Social Security income, reasoning that since Social Security taxes are a business expense for them, they should reduce or offset employee pension benefits by a percentage of the Social Security money. An employer with a 100% offset would subtract the entire Social Security payment from the earned pension and pay only the difference as the employee pension. A 50% offset means the employer subtracts half of the Social Security benefit from the pension benefit and pays the difference.

Have a question or comment?
We're here to help.

*** Your email address will remain confidential.


Popular Insurance Terms

Popular Insurance Questions