Is your company familiar with this year’s changes to the 401(k) retirement and pension plan limits that were made effective January 1, 2013 by the IRS?
If you missed the updates, here’s what you need to know:
1. Your employees’ elective contribution limits (assuming they participate in a 401(k), 403(b) or a 457 plan) have increased from $17,000 to $17,500 per employee. Catch-up Contributions, which are the additional amounts over basic Internal Revenue Code (IRC) limits that employee participants age 50 or older may contribute to, remain the same in 2013. The catch-up contribution limit for those 50 or older is still $5500, and includes any employee that will reach the age of 50 in 2013.
2. Defined ContributionPlans (retirement plans in which the amount of the employer’s annual contribution is specified) increased its limits from $50,000 to $51,000 per participant.
Helping employees plan their retirement is not easy when you have multiple employees to manage. It’s especially difficult when you’re not a retirement specialist yourself. How will you address the numerous questions employees bring forth this year with the changes, when you need to be concerned about your own company’s contributions and limits?
The co-employment relationship presents robust benefits for both the employer and the employee. Most PEOs grantaccess to fortune 500 quality benefits such as 401(k), Section 125 Plans and Flexible Spending. And, contrary to common misapprehensions, you CAN easily begin a new PEO contract on March 1, or the first of any month for that matter, versus waiting until January of next year.