DOCSLIB.ORG

Publication 560, Retirement Plans for Small Business

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Publication 560, Retirement Plans for Small Business Userid: CPM Schema: tipx Leadpct: 100% Pt. size: 8 Draft Ok to Print AH XSL/XML Fileid: … tions/P560/2020/A/XML/Cycle07/source (Init. & Date) _______ Page 1 of 31 16:18 - 1-Mar-2021 The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing. Publication 560 Cat. No. 46574N Contents What's New .................. 1 Department of the Retirement Reminders ................... 2 Treasury Internal Introduction .................. 2 Revenue Plans Service Chapter 1. Definitions You Need for Small To Know ................. 4 Chapter 2. Simplified Employee Pensions (SEPs) ............ 5 Business Setting Up a SEP ............. 6 How Much Can I Contribute? ...... 6 Deducting Contributions ......... 7 (SEP, SIMPLE, and Salary Reduction Simplified Employee Pensions Qualified Plans) (SARSEPs) .............. 7 Distributions (Withdrawals) ....... 8 Additional Taxes ............. 8 Reporting and Disclosure For use in preparing Requirements ............. 8 Chapter 3. SIMPLE Plans ......... 8 2020 Returns SIMPLE IRA Plan ............. 9 SIMPLE 401(k) Plan .......... 11 Chapter 4. Qualified Plans ........ 11 Kinds of Plans ............. 12 Qualification Rules ........... 12 Setting Up a Qualified Plan ...... 14 Minimum Funding Requirement ... 14 Contributions .............. 14 Employer Deduction .......... 15 Elective Deferrals (401(k) Plans) ... 16 Qualified Roth Contribution Program ............... 18 Distributions ............... 18 Prohibited Transactions ........ 20 Reporting Requirements ....... 21 Chapter 5. Coronavirus - Related Distributions .............. 22 Qualified Individual ........... 22 Special Tax Treatment ......... 22 Repayment of Distributions and Tax Reporting Requirements ... 22 Chapter 6. Table and Worksheets for the Self-Employed ........ 24 Chapter 7. How To Get Tax Help .... 27 Index ..................... 30 Future Developments For the latest information about developments related to Pub. 560, such as legislation enacted after it was published, go to IRS.gov/Pub560. What's New Get forms and other information faster and easier at: Coronavirus-related distributions. Section • IRS.gov (English) • IRS.gov/Korean (한국어) 2202(a)(4)(A) of the CARES Act defines a coro- • IRS.gov/Spanish (Español) • IRS.gov/Russian (Pусский) navirus-related distribution as any distribution • IRS.gov/Chinese (中文) • IRS.gov/Vietnamese (Tiếng Việt) from an eligible retirement plan made on or after January 1, 2020, and before December 31, Mar 01, 2021 Page 2 of 31 Fileid: … tions/P560/2020/A/XML/Cycle07/source 16:18 - 1-Mar-2021 The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing. 2020, to a Qualified Individual (defined later). Small employer automatic enrollment The amount of aggregate distributions from all credit. The Further Consolidated Appropria- Introduction eligible retirement plans that can be treated as tions Act, 2020, P.L. 116-94, added section a coronavirus-related distribution is limited to no 45T. An eligible employer may claim a tax credit Section references are to the Internal Revenue more than $100,000. See Coronavirus-Related when it sponsors a qualified employer plan in- Code unless otherwise noted. Distributions, later. cluding an eligible automatic contribution ar- This publication discusses retirement plans rangement. The credit equals $500 per year you can set up and maintain for yourself and Qualified birth or adoption distribution. Be- your employees. In this publication, “you” refers ginning in tax years after December 31, 2019, over a 3-year period beginning with the first tax year beginning after December 31, 2019, and to the employer. See chapter 1 for the definition you can take a distribution from your IRA with- of the term “employer” and the definitions of out it being subject to the 10% additional tax for could first be claimed on the employer’s return for the year 2020. other terms used in this publication. This publi- early distributions if that distribution is for a cation covers the following types of retirement qualified birth or adoption. For more informa- Increase in credit limitation for small em- plans. tion, see Qualified birth or adoption distribution. ployer plan startup costs. The Further Con- • SEP (simplified employee pension) plans. under Introduction, later. solidated Appropriations Act, 2020, P.L. • SIMPLE (savings incentive match plan for Compensation limits for 2020 and 2021. For 116-94, also amended section 45E. For tax employees) plans. 2020, the maximum compensation used for fig- years beginning after December 31, 2019, eligi- • Qualified plans (also called H.R. 10 plans uring contributions and benefits is $285,000. ble employers can claim a tax credit for the first or Keogh plans when covering self-em- This limit increases to $290,000 for 2021. credit year and each of the 2 tax years immedi- ployed individuals), including 401(k) plans. ately following. The credit equals 50% of quali- SEP, SIMPLE, and qualified plans offer you Elective deferral limits for 2020 and 2021. fied startup costs, up to the greater of (a) $500; and your employees a tax-favored way to save The limit on elective deferrals, other than or (b) the lesser of (i) $250 for each employee for retirement. You can deduct contributions catch-up contributions, is $19,500 for 2020 and who is not a “highly compensated employee” el- you make to the plan for your employees. If you 2021. These limits apply for participants in igible to participate in the employer plan, or (ii) are a sole proprietor, you can deduct contribu- SARSEPs, 401(k) plans (excluding SIMPLE $5,000. See the instructions for Form 3800 and tions you make to the plan for yourself. You can plans), section 403(b) plans, and section 457(b) Form 8881 for more information on the startup also deduct trustees' fees if contributions to the plans. cost credit. plan don't cover them. Earnings on the contribu- Defined contribution limits for 2020 and Qualified automatic contribution arrange- tions are generally tax free until you or your em- 2021. The limit on contributions, other than ment (QACA) safe harbor plans. Effective ployees receive distributions from the plan. catch-up contributions, for a participant in a de- for plan years beginning after December 31, Under a 401(k) plan, employees can have fined contribution plan is $57,000 for 2020 and 2019, when an employee doesn’t make an affir- you contribute limited amounts of their be- increases to $58,000 for 2021. mative election specifying a deferral percent- fore-tax (after-tax, in the case of a qualified Defined benefit limits for 2020 and 2021. age, the maximum default deferral percentage Roth contribution program) pay to the plan. The limit on annual benefits for a participant in a increases from 10% to 15%. These amounts (and the earnings on them) are defined benefit plan is $230,000 for 2020 and generally tax free until your employees receive 2021. distributions from the plan or, in the case of a qualified distribution from a designated Roth ac- SIMPLE plan salary reduction contribution Reminders count, completely tax free. limit for 2020 and 2021. The limit on salary reduction contributions, other than catch-up Changes to the hardship distribution rules What this publication covers. This publica- contributions, is $13,500 for 2020 and 2021. for section 401(k) plans. The Bipartisan tion contains the information you need to under- Catch-up contribution limits for 2020 and Budget Act of 2018, P.L. 115-123, made stand the following topics. 2021. A plan can permit participants who are changes to the hardship distribution rules for • What type of plan to set up. plan years beginning after December 31, 2018. age 50 or over at the end of the calendar year to • How to set up a plan. Removes the 6-month prohibition on con- make catch-up contributions in addition to elec- • • How much you can contribute to a plan. tributions following a hardship distribution. tive deferrals and SIMPLE plan salary reduction • How much of your contribution is deducti- Permits hardship distributions to be made contributions. The catch-up contribution limita- • ble. from contributions, earnings on contribu- tion for defined contribution plans other than • How to treat certain distributions. tions, and employer contributions. SIMPLE plans is $6,500 for 2020 and 2021. • How to report information about the plan to Eliminates any requirement to take plan The catch-up contribution limitation for SIMPLE • the IRS and your employees. loans prior to taking a hardship distribution. plans is $3,000 for 2020 and 2021. • Basic features of SEP, SIMPLE, and quali- A participant's catch-up contributions for a Retirement savings contributions credit. fied plans. The key rules for SEP, SIMPLE, year can't exceed the lesser of the following Retirement plan participants (including self-em- and qualified plans are outlined in Table 1. amounts. ployed individuals) who make contributions to SEP plans. SEP plans provide a simplified The catch-up contribution limit. their plan may qualify for the retirement savings • method for you to make contributions to a retire- The excess of the participant's compensa- contribution credit. The maximum contribution • ment plan for yourself and your employees. In- tion over the elective deferrals that aren’t eligible for the credit is $2,000. To take the stead of setting up a profit-sharing or money catch-up contributions. credit, use Form 8880, Credit for Qualified Re- tirement Savings Contributions. For more infor- purchase plan with a trust, you can adopt a SEP See Catch-up contributions under Contribution mation on who is eligible for the credit, retire- agreement and make contributions directly to a Limits and Limit on Elective Deferrals in chap- ment plan contributions eligible for the credit, traditional individual retirement account or a tra- ters 3 and 4, respectively, for more information. and how to figure the credit, see Form 8880 and ditional individual retirement annuity (SEP-IRA) Repeal of maximum age for traditional IRA its instructions or go to IRS.gov/Retirement- set up for yourself and each eligible employee.
Load more

Recommended publications
  • Form W-4, Employee's Withholding Certificate
    Employee’s Withholding Certificate OMB No. 1545-0074 Form W-4 ▶ (Rev. December 2020) Complete Form W-4 so that your employer can withhold the correct federal income tax from your pay. ▶ Department of the Treasury Give Form W-4 to your employer. 2021 Internal Revenue Service ▶ Your withholding is subject to review by the IRS. Step 1: (a) First name and middle initial Last name (b) Social security number Enter Address ▶ Does your name match the Personal name on your social security card? If not, to ensure you get Information City or town, state, and ZIP code credit for your earnings, contact SSA at 800-772-1213 or go to www.ssa.gov. (c) Single or Married filing separately Married filing jointly or Qualifying widow(er) Head of household (Check only if you’re unmarried and pay more than half the costs of keeping up a home for yourself and a qualifying individual.) Complete Steps 2–4 ONLY if they apply to you; otherwise, skip to Step 5. See page 2 for more information on each step, who can claim exemption from withholding, when to use the estimator at www.irs.gov/W4App, and privacy. Step 2: Complete this step if you (1) hold more than one job at a time, or (2) are married filing jointly and your spouse Multiple Jobs also works. The correct amount of withholding depends on income earned from all of these jobs. or Spouse Do only one of the following. Works (a) Use the estimator at www.irs.gov/W4App for most accurate withholding for this step (and Steps 3–4); or (b) Use the Multiple Jobs Worksheet on page 3 and enter the result in Step 4(c) below for roughly accurate withholding; or (c) If there are only two jobs total, you may check this box.
    [Show full text]
  • IRS Publication 4128, Tax Impact of Job Loss
    Publication 4128 Tax Impact of Job Loss The Life Cycle Series A series of informational publications designed to educate taxpayers about the tax impact of significant life events. Publication 4128 (Rev. 5-2020) Catalog Number 35359Q Department of the Treasury Internal Revenue Service www.irs.gov Facts JOB LOSS CREATES TAX ISSUES References The Internal Revenue Service (IRS) recognizes that the loss of a job may • Publication 17, Your create new tax issues. The IRS provides the following information to Federal Income Tax (For assist displaced workers. Individuals) • Severance pay and unemployment compensation are taxable. • Publication 575, Payments for any accumulated vacation or sick time are also Pension and Annuity taxable. You should ensure that enough taxes are withheld from Income these payments or make estimated payments. See IRS Publication 17, Your Federal Income Tax, for more information. • Publication 334, Tax Guide for Small • Generally, withdrawals from your pension plan are taxable unless Businesses they are transferred to a qualified plan (such as an IRA). If you are under age 59 1⁄2, an additional tax may apply to the taxable portion of your pension. See IRS Publication 575, Pension and Annuity Income, for more information. • Job hunting and moving expenses are no longer deductible. • Some displaced workers may decide to start their own business. The IRS provides information and classes for new business owners. See IRS Publication 334, Tax Guide for Small Businesses, for more information. If you are unable to attend small business tax workshops, meetings or seminars near you, consider taking Small Business Taxes: The Virtual Workshop online as an alternative option.
    [Show full text]
  • Section 5 Explanation of Terms
    Section 5 Explanation of Terms he Explanation of Terms section is designed to clarify Additional Standard Deduction the statistical content of this report and should not be (line 39a, and included in line 40, Form 1040) T construed as an interpretation of the Internal Revenue See “Standard Deduction.” Code, related regulations, procedures, or policies. Explanation of Terms relates to column or row titles used Additional Taxes in one or more tables in this report. It provides the background (line 44b, Form 1040) or limitations necessary to interpret the related statistical Taxes calculated on Form 4972, Tax on Lump-Sum tables. For each title, the line number of the tax form on which Distributions, were reported here. it is reported appears after the title. Definitions marked with the symbol ∆ have been revised for 2015 to reflect changes in Adjusted Gross Income Less Deficit the law. (line 37, Form 1040) Adjusted gross income (AGI) is defined as total income Additional Child Tax Credit (line 22, Form 1040) minus statutory adjustments (line 36, (line 67, Form 1040) Form 1040). Total income included: See “Child Tax Credit.” • Compensation for services, including wages, salaries, fees, commissions, tips, taxable fringe benefits, and Additional Medicare Tax similar items; (line 62a, Form 1040) Starting in 2013, a 0.9 percent Additional Medicare Tax • Taxable interest received; was applied to Medicare wages, railroad retirement com- • Ordinary dividends and capital gain distributions; pensation, and self-employment income that were more than $200,000 for single, head of household, or qualifying • Taxable refunds of State and local income taxes; widow(er) ($250,000 for married filing jointly, or $125,000 • Alimony and separate maintenance payments; for married filing separately).
    [Show full text]
  • SIMPLE IRA and SEP IRA Plans Workbook and Forms
    Employer’s Workbook Franklin Templeton SIMPLE IRA and SEP IRA Plans AGREEMENTS & FORMS Table of Contents Franklin Templeton SIMPLE IRA How to Get Started .......................................... 1 SIMPLE IRA Employer Contribution Worksheet. 2 SIMPLE IRA Employer Agreement (Form 5304-SIMPLE) ......... 3 Model Notification to Eligible Employees ....................... 5 Model Salary Reduction Agreement ............................ 6 General Instructions .......................................... 7 Franklin Templeton SEP IRA How to Get Started .......................................... 9 SEP IRA Employer Agreement (Form 5305-SEP) ................ 10 Franklin Templeton eContributions Services eContributions Services Employer Application ................. 13 eContributions New User Request Form ........................ 15 eContributions How to Fund Your Plan ........................ 17 For assistance with completing forms and documents, please contact your financial advisor or Franklin Templeton Retirement Services at (800) 527-2020. Not FDIC Insured | May Lose Value | No Bank Guarantee Franklin Templeton SIMPLE IRA How to Get Started 1. Complete and sign the SIMPLE IRA Employer Agreement (IRS Form 5304-SIMPLE) on pages 3 and 4. 2. Complete and sign the eContributions Services Employer Application on page 13 and eContributions New User Request Form on page 15 to set up electronic delivery of your payroll contribution instructions.* eContributions is a secure, proprietary, online payroll contribution instruction system that provides a cost-efficient
    [Show full text]
  • The Vanguard SIMPLE IRA Employer Guide
    What’s inside: • Forms • Disclosure SIMPLE IRA Employer Kit Statement and Custodial Account To establish a SIMPLE IRA plan Agreement How to establish a plan 1. Set up your new plan. If a plan hasn’t been established, you must complete the enclosed SEP-IRA/SIMPLE IRA Plan Authorization Form and IRS Form 5305-SIMPLE. Don’t send IRS Form 5305-SIMPLE to Vanguard or the IRS; keep it for your records.* 2. Set up individual accounts within the plan. Each employee must complete the SIMPLE IRA New Account Form, a copy of which is enclosed. 3. Provide a copy of your completed IRS Form 5305-SIMPLE to all employees. 4. Return the Vanguard forms to us. In about ten business days, we’ll send each new participant a confirmation that a Vanguard SIMPLE IRA has been established in his or her name. 5. Establish online access. To contribute to and manage your plan, you’ll need to establish access to Vanguard Small Business Online®. You’ll receive instructions on how to do this once you’ve established your plan. 6. Enroll additional employees. Log on to Vanguard Small Business Online and select Enroll a participant in the plan to send an email to each employee with information on how to open an account online. Each participating employee should also complete and submit to you a Model Salary Reduction Agreement from IRS Form 5305-SIMPLE, which you should provide to all your employees. Questions? If you need assistance, call us at 800-205-6189 Monday through Friday from 8 a.m.
    [Show full text]
  • Income – Wages, Interest, Etc
    Income – Wages, Interest, Etc. Introduction What do I need? □ Form 13614-C This is the first of nine lessons covering the Income section of the □ Publication 4012 taxpayer’s return. A critical component of completing the taxpayer’s return □ Publication 17 is distinguishing between taxable and nontaxable income and knowing Optional: where to report the different types of income on Form 1040. □ Form 1040 Instructions Objectives □ Form 1099-PATR At the end of this lesson, using your resource materials, you will be able to: □ Schedule B • Compute taxable and nontaxable income □ Publication 531 • Distinguish between earned and unearned income □ Publication 550 Publication 926 • Report income correctly on Form 1040 □ □ Publication 970 The following chart will help you select the appropriate topic for your certification course. Certification Course Basic Advanced Military International Wages & Reported Tips Unreported Tip Income Scholarship and Fellowship Income Interest Income Dividend Income Taxable Refunds Alimony Received Business Income Capital Gain/Loss Other Gains/Losses N/A N/A N/A N/A IRA Distributions* Pensions/Annuities* Rental Income Schedule K-1 Distributions Farm Income N/A N/A N/A N/A Unemployment Compensation Social Security Benefits Other Income Foreign Earned Income Military Income *Basic only if the taxable amount is already determined. Income – Wages, Interest, Etc. 8-1 How do I determine taxable and nontaxable income? The Income Quick Reference Guide in the Volunteer Resource Guide, Tab D, Income, includes examples of taxable and nontaxable income. Gross income is all income received in the form of money, goods, property, and services that is not exempt from tax.
    [Show full text]
  • Instructions for Form 1099-DIV (Rev. January 2022)
    Note: The draft you are looking for begins on the next page. Caution: DRAFT—NOT FOR FILING This is an early release draft of an IRS tax form, instructions, or publication, which the IRS is providing for your information. Do not file draft forms and do not rely on draft forms, instructions, and publications for filing. We do not release draft forms until we believe we have incorporated all changes (except when explicitly stated on this coversheet). However, unexpected issues occasionally arise, or legislation is passed—in this case, we will post a new draft of the form to alert users that changes were made to the previously posted draft. Thus, there are never any changes to the last posted draft of a form and the final revision of the form. Forms and instructions generally are subject to OMB approval before they can be officially released, so we post only drafts of them until they are approved. Drafts of instructions and publications usually have some changes before their final release. Early release drafts are at IRS.gov/DraftForms and remain there after the final release is posted at IRS.gov/LatestForms. All information about all forms, instructions, and pubs is at IRS.gov/Forms. Almost every form and publication has a page on IRS.gov with a friendly shortcut. For example, the Form 1040 page is at IRS.gov/Form1040; the Pub. 501 page is at IRS.gov/Pub501; the Form W-4 page is at IRS.gov/W4; and the Schedule A (Form 1040/SR) page is at IRS.gov/ScheduleA.
    [Show full text]
  • THE BIGGEST CON How the Government Is Fleecing You
    On October 8, 1974, before a joint session of the Congress, President Ford call- ed "inflation, our public enemy No. 1." Schiffs thesis is that since it's the Federal government that causes that inflation, it's the Federal government that is, in reality, "public enemy No. 1" — and blistering chapters add to this in- dictment. With irrefutable evidence and driving logic, he accuses the Federal government of converting the American economy to national socialism and turning American workers into Federal peons. With facts and figures he shows how, when, and why the Federal government: • Causes inflation • Steals more from the public in a week than the Mafia does in a year • Declared official bankruptcy three times since 1970 • Created the energy crisis • Legislates unemployment, poverty and crime • Fraudulently conceals the nation's $8 trillion public debt • Unconstitutionally enforces a fraudulently acquired power to tax income, and • Why Social Security is a gigantic fraud from which taxpayers can now legally "drop out" • Why the Federal government is nothing but a profit making* business monopoly, and • Why he has paid no.income taxes since 1973. * For those who run it. IRWIN A. SCHIFF THE BIGGEST CON How The Government Is Fleecing You Foreword by John Chamberlain jfretbom Pooktf Las Vegas, Nevada Illustrations and Graphs by Emanuel Zeid Cover by Danial Brown Copyright 1976, 1977 by Irwin A. Schiff All rights reserved. No portion of this book may be reproduced without written permission from the publisher except by a reviewer who may quote brief passages in connection with a review. Manufactured In the United States of America ISBN 0-930374-01-0 PRINTING HISTORY Arlington House Edition - Published April, 1976 Freedom Books Edition - Published August, 1977 Freedoms Book.
    [Show full text]
  • SIMPLE IRA Disclosure Statement and Custodial Agreement
    Provide this form to the client. Do NOT send it to the Corporate Office. Your Guide to SIMPLE IRAs SIMPLE IRA disclosure statement and custodial agreement SIMPLE IRAs with an Ameriprise Brokerage Account or mutual funds Part 1. SIMPLE IRA disclosure statement have an annual $75 custodial fee. Section 1. Introduction SIMPLE IRAs with only an Ameriprise Managed Account or an Ameriprise Certificate account have no annual custodial fee. Some More information on SIMPLE IRAs is available in Publications 560 investments may generate unrelated business taxable income. In Retirement Plans for Small Business (SEP, SIMPLE and Qualified such cases, Ameriprise Trust will complete a tax return (Form 990-T) Plans) and 590, Individual Retirement Arrangements (IRAs), from the for your SIMPLE IRA and remit any taxes owed from your SIMPLE IRS. Obtain your copy from any IRS district office by calling 1 (800) IRA. Ameriprise Trust will charge a $200 fee if a 990-T filing is 829.3676 or by going to irs.gov. required for your SIMPLE IRA. Ameriprise Trust may charge a $200 estate settlement processing fee. Entities Investment products In this disclosure statement, "you" and "your" refer to the current owner (original or inherited) of an Ameriprise SIMPLE IRA. "We," "us" and Investment products you purchase within your SIMPLE IRA may "our" refer to Ameriprise Financial, Inc., and/or its subsidiaries charge transaction fees, sales commissions, investment including, but not limited to Ameriprise Trust Company (Ameriprise management fees, distribution fees, setup fees, etc. Fees are subject Trust), RiverSource Life Insurance Company, and RiverSource Life to change and will vary by investment.
    [Show full text]
  • SIMPLE IRA Implementation Guide (24004)
    Ameriprise® SIMPLE IRA Plan Implementation Guide Ameriprise SIMPLE Plan Congratulations on your new retirement plan Your Ameriprise® SIMPLE IRA plan is a smart choice because it’s designed just for small businesses. This tax-advantaged retirement plan benefits you, your business and your employees in many ways: ­­Benefits­for­you­and­your­business. Benefits­for­your­employees. • Attract employees • Salary deferrals – You can compete for labor more effectively by – Employees have a convenient way to save for offering an attractive retirement program, the retirement through salary deferrals cornerstone of many benefit packages – Employees age 50 and over may make additional • Reduce taxes “catch-up” salary deferral contributions – You can reduce pre-tax profits by making deductible • Tax-deferred growth contributions to the plan – Employees can benefit from the advantages of • Low administrative costs potential earnings on tax-deferred savings while the – Unlike some other retirement plans, there is no assets remain in their SIMPLE IRA annual IRS Form 5500 reporting required • Investment control – There is no requirement to track vesting – Contributions are made directly to the participant’s • Your employees can contribute to their retirement SIMPLE IRA, giving your employees control over their savings through convenient payroll deductions own investment 24004 AF (10/20) Page 1 of 40 Ameriprise SIMPLE Plan­­ The Ameriprise Financial advantage For more than 120 years, Ameriprise Financial has The table on the opposite page provides more been helping clients just like you reach their long-term information on the use of each required form and financial goals. Count on your Ameriprise financial document. advisor to provide the high-quality service and support You’ll need to use some forms and documents in this necessary to meet your needs and those guidebook more than once.
    [Show full text]
  • SEP IRA Application Use This Form to Establish an Invesco SEP Or SARSEP IRA with Invesco Trust Company (ITC) As Custodian
    SEP IRA Application Use this form to establish an Invesco SEP or SARSEP IRA with Invesco Trust Company (ITC) as custodian. For all other IRA types, please complete and submit the appropriate Invesco account application. Minors may not open an Invesco IRA. IMPORTANT INFORMATION ABOUT OPENING A NEW ACCOUNT: Federal law mandates that all financial institutions obtain, verify and record information identifying each person who opens a new account. Please verify the following information is accurate: name, Social Security number, date of birth and physical residential address. If you fail to provide the requested information and/or if any of the information cannot be confirmed, Invesco Investment Services, Inc. (IIS), reserves the right to redeem the account. The Invesco Privacy Notice, which conforms with applicable law, is located at the end of the form. PLEASE USE BLUE OR BLACK INK PLEASE PRINT CLEARLY IN BLOCK CAPITAL LETTERS 1 | SEP IRA Account Type (Select one.) If an account type is not selected, I am directing IIS to establish a SEP IRA on my behalf. n SEP IRA n SARSEP IRA (Plan must have been established prior to 1997.) 2 | Participant Information Full Name Social Security Number (Required) Date of Birth (Required) (mm/dd/yyyy) Mailing Address (Account statements and confirmations will be mailed to this address.) City State ZIP Primary Phone Number Email Address Residential Address (Required if different than your mailing address or if a P.O. Box was given above.) City State ZIP eDelivery Receive statements, confirmations, account correspondence, shareholder reports, news and updates, and tax forms online instead of by U.S.
    [Show full text]
  • Public Employee Deferred Compensation
    Public Employee Deferred Compensation ILLINOIS PUBLIC PENSION FUND ASSOCIATION PUBLIC SAFETY FINANCIAL AND INVESTMENT TRAINING (IPPFA PS-FIT) NOTE: This Section is excerpted from Retirement Income for Illinois Fire and Police: Pensions, Social Security and Deferred Compensation, by Daniel W. Ryan. All rights reserved. Used with permission by the IPPFA. Chapter 1: Deferred Compensation— Introduction and Participation WHAT IS DEFERRED COMPENSATION? When a person receives wages (i.e., compensation), income taxes are withheld and the total earned is reported to the IRS at the end of the year. However, sections of the Internal Revenue Code and Illinois law allow an employee to defer receipt of some wages until after he or she retires. At the time these deferred wages are earned, they are neither received in the paycheck, subjected to tax withholding, nor reported as taxable to the IRS. They are instead deposited into an account and invested as directed by the employee. When the accumulated money is ultimately received after retirement, the withdrawal payments are then reported to the IRS as taxable distributions. This deferral of wages and taxes until after retirement is commonly referred to as deferred compensation or “deferred comp.” For most public employees, deferred compensation under IRC code Section 457 is the strongest part of the “personal savings” leg of the three-legged retirement income stool (pension, Social Security, and personal savings). Your personal savings can of course include the value of your home, brokerage 1 accounts, individual retirement accounts, investment real estate, and bank savings. But the ability to save through the paycheck on a tax-advantaged basis has made deferred compensation a large personal asset for most public employees.
    [Show full text]