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Severance/Early Retirement Packages and 401k
Benefits & Compensation
Severance/Early Retirement Packages and 401k
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We are considering offering an early retirement package to one of our mployees. We believe this employee is only working to continue contributing to a 401k plan. I know deferred payment plans are
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Severance/Early Retirement Packages and 401k

posted at 8/31/2005 4:31 AM EDT
Posts: 2
First: 8/31/2005
Last: 8/31/2005
We are considering offering an early retirement package to one of our mployees. We believe this employee is only working to continue contributing to a 401k plan.

I know deferred payment plans are not deducted from severance payments.

Can someone tell me if we can contribute to this employee's 401k plan directly in lieu of or part of the severance/early retirement package?
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Severance/Early Retirement Packages and 401k

posted at 8/31/2005 12:01 PM EDT
Posts: 2442
First: 2/12/2000
Last: 9/14/2011
[quote]
On 2005-08-31 08:32, gtatkinson wrote:
We are considering offering an early retirement package to one of our mployees. We believe this employee is only working to continue contributing to a 401k plan.

I know deferred payment plans are not deducted from severance payments.

Can someone tell me if we can contribute to this employee's 401k plan directly in lieu of or part of the severance/early retirement package?

[/quote]

When it comes to what you can or cannot do, the first rule is always read the plan or SPD.

Second, 401k plan contributions normally can only made on income as it is earned as an employee. Payments made after termination would not normally be allowable.

When you say that "defered payment plans are not deducted from severance pay" you are probably correct but it may depend on how the amounts are paid and the employees technical status when the payments are made. See what the plan says and check with an ERISA attorney.
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Severance/Early Retirement Packages and 401k

posted at 12/9/2010 10:13 AM EST
Posts: 1
First: 12/9/2010
Last: 12/9/2010
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Severance/Early Retirement Packages and 401k

posted at 12/9/2010 4:17 PM EST
Posts: 562
First: 11/12/2009
Last: 9/14/2011
Gotta love how self promoters dig up 5 year old threads to add on to.
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Forums » Topic Forums » Benefits & Compensation » Severance/Early Retirement Packages and 401k

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