Administered by TIAA
All employees are eligible to contribute to a self-directed, tax advantage investment account. Employees working 30 or more hours weekly are also eligible for employer matching contributions and annual discretionery base contributions. Matching is available at 50% of the employee contribution up to a max of 4%, (match would be 2%). An annual discretionary 2% will also be contributed from the Employer to the employee's account if the employee is employed & eligible on Dec. 31st of each year; retirements & disability will not decrease this base annual contribution.
Employees working less than 30 hours a week may make voluntary contributions without the match or base; let them know annual fees are a minimum $48.00.
401k accounts are qualified retirement accounts subject to early withdrawal taxes penalties before age 59&1/2.
If you are a new or existing employee and would like to deduct monthly 401k voluntary contributions from your pay, you should complete the Salary Reduction Agreement, (form link below) and give the completed form to the payroll administrator at your location. You will receive a welcome packet from TIAA-CREF after your first contribution.
Federal law imposes a limit on the amount individuals may contribute to their 401(k) accounts on a yearly basis.
2015 & 2016:
$18,000 - the annual maximum for individuals younger than age 50.
$24,000 - the annual maximum for individuals age 50 and older.
This limit is subject to increase or decrease each year. If your location uses a payroll service, it is likely that the payroll service will automatically stop withholding contributions from an employee's pay check once that employee has reached the annual maximum, but check to be sure.
100% VESTED IMMEDIATELY for employer contributions, if they are working at least 30 or more hours weekly without a break. Employees are also immediately vested for voluntary contributions.
enrolling or waiving contributions in the 401kK PLAN
1. To enroll or waive an employee in the Lay 401K Program, have the employee complete the SRA/Salary Reduction Agreement (see form below). Keep these forms on file at your location. These forms are subject to audit. If an employee works 30 hours or more a week, they must complete the SRA. If this is not completed you should deduct 1% of their gross pay as a voluntary 401k contribution for retirement.
New forms are required only when a change is requested by the employee for their Voluntary contribution.
- All regular part time & full time employees are eligible to contribute to the Lay 401k Plan.
- Employees working 30 or more hours weekly are also eligible for matching funds up to a maximum 2% of their 4% contribution.
- All employee working 30 or more hours weekly are eligible for the Annual 2% Base Contribution (regardless of Voluntary contributions).
2. You will need to be sure to enter the 401k deduction into your payroll system.
- New Employee - the software will prompt you through a "New Employee Wizard" to enter required information on the employee. Be sure to either enter an enrollment start date or enter a waive date for the Voluntary 401k Contribution.
- Existing Employee - After uploading payroll & before creating the invoice be sure to go to the "Employees" tab, click on "View/Edit Employee," and "Plan Information". Edit the "Lay 401k Voluntary" benefit. Be sure the "Eligibility" box is checked and add a start date if it is not entered. The Employee must be enrolled in the 401k Plans, (Voluntary, Match & Base) to appear on the 401k invoice.
BEFORE YOU AUTHORIZE PAYMENT of your 401k invoice, check the 401k invoice to be sure the employee is listed correctly along with the correct contributions. Call Patty Dickinson for assistance 913-647-0363.
Other 401k Facts you need to know:
- Regular Part Time employees who average less than 30 hours a week may make 401K Voluntary Contributions, but they are not eligible for the Match or Base contributions and keep in mind that annual fees are $48.00 plus individual investment fees.
- Employee Federal Taxes: 401K Contributions are subject to FICA, (Social Security & Medicare taxes), but not Federal, State or Local Income Taxes. Take FICA out of Employee Pay before the 401k Voluntary Contribution is deducted.
- W2 Forms: The Pension box should be checked for any employee who makes a Voluntary contribution and/or who receives a Match, Base or Annual Base Contribution. You are not required to report any 401k match or base contributions on the employee pay stubs or W2s. You will not need to report the employee 401k voluntary deductions on any other Federal or State Employer Tax Reports. The Employer Match & Base Contributions will be reported by the Archdiocese offices.
- The 401k Plan is not available to Temporary, Seasonal, Casual Employees, Substitute Teachers, 1099 Independent Contractors or Federal Work-Study Employees.W2 Forms
LAY 401k PLAN STARTING & STOPPING CONTRIBUTIONS
Starting: A full time employee is required to complete a Salary Reduction Agreement (below) to Waive or Begin Voluntary contributions. If this is not done 1% of employee pay should be deducted for the employee voluntary contribution. Keep the Salary Reduction Forms in a file at your location for audit purposes. You will enter Employee contributions as 401k paycheck deductions into your payroll and then upload or enter payroll into Who's Where. The Who's Where software then enables you to create and authorize invoices that include 401k contributions to TIAA-CREF. Employer match & base contributions are automatically calculated and created when the invoice is created.
Stopping: If an employee stops a 401k Voluntary contribution due to a Hardship Withdrawal, the Voluntary contribution cannot be restarted for a minimum 6 months.
If an employee stops a 401k voluntary contribution due to any other reason, such as disability, the voluntary contribution can be restarted at any time; there is no wait period.
employee Bonus 401k guidelines
General Bonus Guidelines
Terminating A person's Employment in Who's Where
Forms & Brochures:
401k Salary Reduction Agreement
401k Outline Brochure
Investing for Catholics investment Brochure
Investing for Catholics Target Funds Brochure
401k Introduction Guide - This guide will be mailed to each new employee with the TIAA-CREF welcome packet.
401k Summary Plan Description 2016 - Lay 401k Plan information for new & existing employees
TIAA Customer Service: 800-842-2252 Lay Plan #406426
Investing for Catholics
Relationship Consultant - Mark Arnold CRPC