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
Modified collateral split dollar life insurance plan under which the employee purchases and owns a life insurance policy on the employee's own life. The employer makes the unscheduled ...
Status in which an insurance company holds funds of its insureds (the payment of premiums) in trust, and through an insuring agreement promises to make all benefit payments for which it has ...
Reinsurance: surplus reinsurance contracts under which the agreement between an insurer and a re insurer is based on the ceding company's line guide, such that the amount re insured is ...
In property insurance, percentages of basic coverages which may be applied to provide coverage for other real and personal property. For example, under the homeowners INSURANCE POLICY ...
Procedure for offering reduced auto insurance rates to drivers with good records, and imposing higher rates on bad drivers. Typically, premiums are weighted under a system that assigns ...
Clause in a property insurance policy that stipulates that either the insurer or the insured has the right to demand an appraisal in order to determine the monetary damage or loss to an ...
Provision in commercial property coverage under which an insured must report the value of an insured property at periodic intervals in order to preserve coverage up to values reported. In ...
Combination property, liability, and business interruption policy. It is usually written to cover expenses of small and medium size businesses resulting from damage or destruction of ...
Nonparticipating life insurance under which the first few annual premiums are smaller than would be the case under a traditional nonparticipating policy. While the maximum amount of these ...
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