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
provision in a CASH VALUE INSURANCE policy that an insured will receive the equity in some form even if the insurance is canceled. vested benefit to a retirement plan participant. It is ...
Error, misstatement, or breach of duty by an officer or director of a company that results in a lawsuit against the company. directors and officers liability insurance covers claims arising ...
Outer covering containing an insurance policy; in many instances it lists provisions common to several types of policies. ...
Stipulation of the exact time when the pension benefit guaranty corporation assumes the legal liabilities for an insured pension plan that is being terminated. ...
disposition of a claim or policy benefit. Policies may specify time limits for payment of claims or benefits and designate various methods of settlement at the option of the insurer or the ...
Provision in a marine insurance policy in which agreement has been reached between the insured and the insurance company concerning the worth of the property that is to be covered under the ...
Coverage in a separate policy or as an endorsement to the commercial general liability (CGL) form, for liability exposures for an employee who drives a leased car or his or her own ...
Coverage in the event that negligent acts and/or omissions by individual (s) and organization (s) result in damage to the environment and a liability suit against these parties. ...
Provision in an Adjustable Life Insurance policy that permits the structure of the policy to be changed by: increasing or decreasing the premium; increasing or decreasing the face amount; ...
Have a question or comment?
We're here to help.