Who is an Employee?

We ask each year that you submit a census of your employees but, interestingly enough, the question: "Who is an employee?" may arise. Obviously a person receiving a W-2 is an employee and should be listed. If we receive a data feed from your payroll company it is implied that your census is complete and your job is done. But, there are circumstances and instances created by the governing Tax Law, and articulated in your Qualified Plan Document, that can cause what you would term as an "Independent Contractor"; a "Contract Employee"; a "Leased Employee"; or a "Temporary To Hire Employee" - folks that you don't consider to be an employee- to be deemed employees. Subsequently, being deemed an e

Understanding the definition of compensation in your plan's legal plan document!

As the Plan Administration and reporting season begins January 1, it's very important that plan sponsors understand the definition of compensation in their legal plan document. The Employees' contributions and or benefits of a plan are always based on the employee's compensation. It's not as easy as you may think! Compensation is not always just W-2 Compensation. The legal plan document may start with W-2 earnings, and then add or subtract certain types of compensation which are taxable to the employee. This may include reimbursements for travel, hotel, auto and entertainment etc. Insurance costs, etc. or other items. It is a "Best Practice" for Plan sponsors to learn, and to review annually

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10501 N. 2nd st | Machesney Park, IL, 61115 | (815) 394-5500

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