Top-heavy Plan
Definition of "Top-heavy plan"
Pension or other employee benefit plan that favors highly compensated employees or top executives or owners of a company. Prior to the tax reform act of 1986, there was no uniform definition of a "highly compensated" employee, but that law provides a specific definition that is used for qualified pension plans, 401 (k) plans, and some other employee benefits. An employee is considered highly compensated if he or she: (1) directly or indirectly owns more than a 5% interest in the company, (2) receives compensation from the company of more than $75,000, (3) is paid more than $50,000 and was among the top 20% of employees ranked by compensation, or (4) is at any time an officer and receives compensation that was more than 150% of the Section 415 defined-contribution dollar amount.
Popular Insurance Terms
Legislation mandating that factors taken into account in the calculation of premium rates for automobile insurance include the insured's driving record, annual miles driven, and years of ...
Type of livestock insurance that covers for cattle and sheep on the range from October 1 to May 1 in the Western states. Perils insured against are the weather, including freezing; most ...
Performance of managerial and clerical functions related to an employee benefit insurance plan by an individual or committee that is not an original party to the benefit plan. In selecting ...
Synopsis of the key financial figures concerning the pension plan that is contained in the form 5500 that must be filed annually with the Internal Revenue Service. This report must be given ...
Protection against the death of an individual in the form of payment to a beneficiary usually a family member, business, or institution. In exchange for a series of premium payments or a ...
Bonds issued by the United States Treasury that earn a fixed interest rate plus the rate of inflation. These bonds are sold at face value in denominations of $50 up to $5000 and may earn ...
One of four SEC divisions that administers the procedure through which public companies must disclose all relevant material in order that a potential investor might make an informed ...
Accounting procedures that defer the full funding of a life insurance net level premium reserve to accommodate the policy acquisition cost in the early years of a policy. First-year policy ...
Modification in premiums, reserves, and other values to reflect actual loss experience and expenses and expected benefits to be paid. ...
Have a question or comment?
We're here to help.