Overview
Plan Design
We recognize that every employer’s objectives and financial capabilities are different. We offer customized plan design services to meet the needs of each employer. Whether the goal is maximizing benefits for owners and key employees or employee recruitment and retention, our plan architects can build a plan to meet your needs.
The Workplace Retirement Plan Resource
This popular resource for financial professionals and employers concisely dives into popular plan designs, providing sample illustrations. It also summarizes key provisions of the SECURE 2.0 Act, including automatic enrollment and the new plan tax credits.
Solo 401(k) Plan
A Solo 401(k) can be established for incorporated or unincorporated businesses employing owners and spouses only (no other employees). A Solo 401(k) may allow small business owners to shelter a greater portion of their income from taxation than is possible with conventional business retirement plans such as SIMPLEs and SEPs. Learn more.
Traditional 401(k) Plan
A traditional 401(k) plan can be adopted by sole proprietors, corporations, partnerships and most non-profit organizations. A 401(k) plan allows employees to defer income from each payroll check and contribute those deferrals to their retirement plan account. Employee contributions are made before federal income taxes and grow tax-deferred until withdrawal. Employers can also make discretionary matching contributions to the plan on behalf of their employees. These contributions can be made subject to a vesting (ownership) schedule and certain other service requirements. Traditional 401(k) plans are subject to special non-discrimination testing that often limits personal plan contributions by the business owner and certain other Highly Compensated Employees. A Safe-Harbor 401(k) Plan design offers relief from this potential problem. Learn more.
Safe Harbor 401(k) Plan
The Small Business Job Protection Act (SBJPA) gave retirement plan sponsors the ability to add Safe Harbor provisions to qualified plans. Adoption of Safe Harbor provisions allows 401(k) plan sponsors to avoid the Actual Deferral Percentage (ADP) test and the Actual Contribution Percentage (ACP) test for employer contributions. These non-discrimination tests are deemed satisfied if the employer agrees to make certain contributions of behalf of plan participants. In other words, Safe Harbor adoption will allow 401(k) participants (including Highly Compensated Employees) to defer up to the maximum IRS limit without fear of non-discrimination test failure and corrective refunds. Learn more.
Super Safe Harbor 401(k) Plan
InWest’s Super Safe Harbor 401(k) Plan combines a Safe Harbor 401(k) Plan design along with a New Comparability Profit Sharing Plan. A Super Safe Harbor 401(k) Plan often allows the sponsor to target a certain employee (business owner) or group of employees for higher plan contributions. Learn more.
Group of Plans (GOP)
A GoP is a new type of plan established by the SECURE Act. Employers (whether unrelated, related, or part of the same controlled group) can file a single Form 5500 for multiple defined contribution plans. While plans that are part of the GoP retain plan design flexibility, the GoP allows them to use their collective purchasing power to obtain lower fees and reduce their administrative and fiduciary burden. To be considered a GoP, the plans must have the same trustee, administrator, fiduciaries, investments, and plan year. A GoP can be an excellent choice for employers with fewer than 100 plan participants.
Pooled Employer Plans (PEP)
Introduced under the SECURE Act, PEPs allow unrelated employers that meet specific requirements (such as having the same “pooled plan provider”) to band together to participate in a single retirement plan. While employers who are part of the PEP retain plan design flexibility, the PEP allows them to use their collective purchasing power to obtain lower fees and reduce their administrative and fiduciary burden. For example, plans that require an annual ERISA audit (100+ participants) can share that cost among multiple employers within the PEP. A PEP can be an excellent fit for employers with over 100 plan participants.
Multiple Employer Plans (MEP)
MEPs typically fall into two primary formats: First, there are MEPs where the participating employers are under common control, such as a group of employers, some of which are owned in whole and others in part by the same parent organization. Second, there are MEPs maintained by independent employers in the same trade, industry group, or association. Examples include Professional Employer Organizations (PEOs) and trade associations.
Traditional Profit Sharing Plan
A Traditional Profit Sharing Plan is a qualified retirement plan, established and funded entirely by employer contributions. The overall contribution level may vary from year to year. The contribution must generally be allocated to each participant’s account in a uniform fashion with each participant receiving the same percentage of compensation. Because of this uniform allocation requirement, many plan sponsors opt for a New Comparability Profit Sharing Plan design that affords some flexibility in determining how much each employee will receive of the profit sharing contribution. Learn more.
New Comparability Profit Sharing Plan
A New Comparability Profit Sharing Plan is generally a profit sharing plan in which the contribution percentage formula for one category of participants is greater than the contribution percentage formula for other categories of participants. Unlike a Traditional Profit Sharing Plan, a New Comparability Plan allows employers some flexibility in determining what percentage of pay each participant will receive of the profit sharing contribution. Employers often use this flexibility to target a certain employee (business owner) or group of employees for higher plan contributions. Learn more.
SoloDB Plan
Our Solo Defined Benefit Plan (SoloDB plan) provides a great opportunity for business owners to accumulate a significant tax-preferred retirement account. Learn more.
Traditional Defined Benefit Plan
A traditional Defined Benefit Plan (DB Plan or DBP) is a retirement plan that provides a benefit for individual participants based on formulas in the Plan Document, such as 50% of pay paid monthly starting at age 65. Learn more.
New Comparability Cash Balance Plan
A Cash Balance Plan is a type of Defined Benefit Plan. It is not an Individual Account Plan (Defined Contribution Plan) since each participant’s benefits are not determined by the performance of the assets held in an individual account for that participant. However, it looks a lot like an Individual Account Plan (such as a Profit Sharing Plan) because the benefits are related to a Hypothetical Cash Balance Account. Because a Cash Balance Plan exhibits some characteristics of both Defined Benefit Plans and Defined Contribution Plans, it is often called a hybrid plan. Learn more.
Defined Benefit / Defined Contribution Combo Plan
A Defined Benefit/Defined Contribution Combination Plan (DB/DC Combo) allows the plan sponsor to offer a two-tiered approach to saving for retirement. The defined benefit plan provides a guaranteed retirement benefit base that can be supplemented with discretionary contributions made into a 401(k)/Profit Sharing Plan. This plan design will be attractive to sponsors that are looking for the flexibility offered in a DC Plan but also find the higher contribution levels possible in a DB Plan attractive. InWest offers turnkey plan design and compliance administration for DB/DC Combo Plans. Learn more.
SoloDB Plan
Our Solo Defined Benefit Plan (SoloDB plan) provides a great opportunity for business owners to accumulate a significant tax-preferred retirement account. Learn more.
New Comparability Cash Balance Plan
A Cash Balance Plan is a type of Defined Benefit Plan. It is not an Individual Account Plan (Defined Contribution Plan) since each participant’s benefits are not determined by the performance of the assets held in an individual account for that participant. However, it looks a lot like an Individual Account Plan (such as a Profit Sharing Plan) because the benefits are related to a Hypothetical Cash Balance Account. Because a Cash Balance Plan exhibits some characteristics of both Defined Benefit Plans and Defined Contribution Plans, it is often called a hybrid plan. Learn more.
Defined Benefit / Defined Contribution Combo Plan
A Defined Benefit/Defined Contribution Combination Plan (DB/DC Combo) allows the plan sponsor to offer a two-tiered approach to saving for retirement. The defined benefit plan provides a guaranteed retirement benefit base that can be supplemented with discretionary contributions made into a 401(k)/Profit Sharing Plan. This plan design will be attractive to sponsors that are looking for the flexibility offered in a DC Plan but also find the higher contribution levels possible in a DB Plan attractive. InWest offers turnkey plan design and compliance administration for DB/DC Combo Plans. Learn more.
403(b) Plan
A Section 403(b) plan is a deferred compensation retirement program that is offered to employees of a tax-exempt organization under IRC Section 501(c)(3) or employees of certain educational organizations. A 403(b) plan is similar to a 401(k) plan in many respects; however, a 403(b) is subject to reduced non-discrimination testing and DOL/IRS reporting.
457 Plan
A Section 457 plan is a “nonqualified” deferred compensation retirement program that is maintained by a State, a political subdivision of a State, an agency or instrumentality of a State, or a tax-exempt organization. InWest has an ASPPA Tax-Exempt & Governmental Plan Consultant on staff and offers turnkey plan design and compliance administration for both 403(b) and 457 retirement plans. We also offer substantial fee discounts for non-profit employers.