Similar to a Special Pay Plan, the Employer Sponsored Plan is funded using unique forms of compensation, such as unused sick leave and unused vacation pay while the employee is actively working. Funds are deposited into a 403(b) or 401(a) retirement plan that employees can access only upon retirement or post-employment.
Our solution helps employers and employees save 7.65% on FICA taxes on employer contributions while also deferring income tax for the employee. The plan design allows the employer to apply a vesting schedule to manage employee eligibility. Employers also receive dedicated account management and 24/7 online plan access. MidAmerica handles all plan administration, compliance and education in-house.
The employee can track the growth of their own retirement account throughout their employment, creating a valuable benefit plan for employers. The funds contributed by the employer are invested with the potential to grow tax-free, which means increased value due to earnings over time. There is also a guaranteed minimum rate of return and variable options are available.