Simplified Employee Pension (sep)
Employee individual retirement account funded by an employer or a self-employed person. (Also known as SEP-IRA.) Differs from a pension plan in that contributions are immediately vested and employees have control of the investment of the SEP-IRA. IRS rules require that SEP-IRA contributions be made according to a written allocation formula. The maximum contribution is 15% of compensation or $30,000, whichever is less. Employees may elect to take cash instead of their SEP-IRA contribution but must pay income taxes on it. The tax reform act of 1986 also allows a SEP-IRA to be used as an alternative to a section 401 (k) plan (salary reduction plan) for an employer with 25 or fewer employees. The maximum annual contribution limit per employee for such salary-reduction SEP-IRAs is $7000.
Popular Insurance Terms
Same as term Ceding Company: insurance company that transfers a risk to a reinsurance company. ...
Property and/or liability coverage for a municipality. Municipalities are responsible for maintenance of through ways as well as a myriad of public services. Liability insurance for ...
Complete coverage for hospital and physician charges subject to deductibles and coinsurance. This coverage combines basic medical expense policy and major medical policy. ...
Exceptions and limitations of coverage; that is, the maximum amount of insurance coverage available under a policy. ...
Early type of no-fault automobile insurance developed by two law professors, Robert Keeton and Jeffrey O'Connell. Its basic premise is that for many accidents it is impossible to place the ...
Coverage primarily for the liability of an individual or organization that results from negligent acts and omissions, thereby causing bodily injury and/or property damage to a third party. ...
Amendment to the law that requires companies that manage retirement plans to permit terminating participants to directly transfer any plan distribution to the individual retirement account ...
Procedure in employee benefit plans to calculate life insurance and retirement benefits to which an employee is entitled. ...
Entitlement to pension benefits without a reduction, even though an employee is no longer in the service of an employer at retirement. For example, under the ten year vesting rule, an ...
Have a question or comment?
We're here to help.