Simplified Employee Pension (sep)
Definition of "Simplified employee pension (sep)"
Employee individual retirement account funded by an employer or a self-employed person. (Also known as SEP-IRA.) Differs from a pension plan in that contributions are immediately vested and employees have control of the investment of the SEP-IRA. IRS rules require that SEP-IRA contributions be made according to a written allocation formula. The maximum contribution is 15% of compensation or $30,000, whichever is less. Employees may elect to take cash instead of their SEP-IRA contribution but must pay income taxes on it. The tax reform act of 1986 also allows a SEP-IRA to be used as an alternative to a section 401 (k) plan (salary reduction plan) for an employer with 25 or fewer employees. The maximum annual contribution limit per employee for such salary-reduction SEP-IRAs is $7000.
Popular Insurance Terms
Determination that group plans offering legal services are limited to an annual tax-free benefit of $70 per employee; group plans may offer employer-provided educational assistance plans on ...
Total assets minus liabilities. It is used by underwriters to evaluate the financial standing of applicants for surety bonds. ...
Supplementary life insurance reserve required by state regulators when the gross premium is lower than the valuation premium. Some life insurers are able to charge policyholders a premium ...
Form of insurance whereby the buyer (reinsurer) assumes the entire obligation of the cedent company, effected through the transfer of the policies from the cedent to the books of the ...
Partnership between an agency of the U.S. government and the Foreign Credit Insurance Association (50 commercial insurance companies, both stock and mutual). Insures that businesses are ...
Device that connects a computer to a telephone line. This device permits the computer to communicate with other computers through the telephone system. ...
Element usually found in industrial life insurance policies under which the insurance company upon the death of the insured under certain conditions is allowed to choose the beneficiary if ...
From favor payment by an insurance company to an insured even though the company has no legal liability. The company makes such a payment for goodwill purposes. ...
Legal right of a passenger in an automobile involved in an accident to bring a liability suit against the driver. It is deemed that a special standard of care is owed by an automobile ...
Have a question or comment?
We're here to help.