PREVAILING WAGE FRINGE MONEY FOR EMPLOYEE RETIREMENT & PENSION PLANS

Making your business more successful is about more than just improving today’s bottom-line. It's also about laying a foundation for the future – for you, and for your employees. That’s why CPWIS helps you to take the fringe off your prevailing wage payroll and put it into one of our bona fide, ‘Money Later’ pension and retirement plans.

CPWIS’ ‘Money Later’ Plans for Pension & Retirement

Rather than pay higher workman’s compensation and payroll taxes as a result of paying your employees their fringe money in cash, you can reduce your job costs by simply giving your workers a ‘Money Later’, prevailing wage pension or retirement plan. Even if you already have a pension or retirement plan in place, such as a safe harbor or profit sharing distribution, CPWIS can show you how to use your mandatory prevailing wage fringe contributions to reduce contributions! You’ll be amazed at how much money you can save with this simple change – enabling you to save money now, and save ‘Money Later’.

Prevailing Wage Pension plans are different

With a prevailing wage pension plan, employers can make pension contributions to their employees on an hourly basis, as opposed to just as a percentage of compensation (as is the case in other pension vehicles). By using part of the employees’ mandatory fringe money for your pension contribution, we help take that money off of payroll and give the employees a retirement plan of value.

Additional benefits for owners

A prevailing wage pension plan solves the problem of not having enough employee money in a retirement plan. Why? Because all of the fringe money paid into the pension plan by the employer is treated as an employer contribution. This means that owners are able to make larger pension contributions to their own accounts without the plan being top heavy. Even if you already have a pension or retirement plan in place, we can show you how to use your mandatory prevailing wage fringe contributions more efficiently!

Highlights of a Prevailing Wage pension plan

Our pension plan document provides the employer with maximum flexibility to reduce their required contributions. We achieve this by using prevailing wage fringe contributions - contributions you're required to make - to assist the owner with their own retirement goals. With our prevailing wage pension plans, you gain the ability to:

 Boost highly compensated employees’ elective deferrals OR offset a profit-sharing distribution

 Meet safe-harbor employer contributions, guaranteeing that highly-compensated employees are able to maximize their elective deferrals; and, when safe harbor provisions are met, utilize the balance to offset a profit sharing distribution

Flexible design options

While our job-cost saving strategy begins with a prevailing wage pension plan as a base, we frequently “layer” pension options on top of that, including:

 Employee-elective deferral

 Better known as a 401(k) plan, your eligible employees can contribute a portion of their own wages in addition to the fringe contribution.

• Profit-sharing plans including new comparability features

Profit-sharing plans enable you to make profit-sharing distributions to a retirement plan INSTEAD OF PAYING THE IRS. Particularly useful when you have made the maximum elective deferral contributions during highly profitable years, these plans are discretionary – meaning you only have to make distributions when it’s to your company’s advantage. And with our inclusion of the IRS’ new comparability features, you can designate different classes of employees to receive different percentages of your profit sharing distribution.

• Safe harbor provisions

Safe harbor insures that your highly compensated employees can contribute the maximum amount to their 401(k) plan.  By agreeing to match all employees’ elective deferral contributions, we make it possible to use fringe dollars to offset the safe harbor match. Not only does this mean more money left over for profit-sharing, it also insures that you are not “double-bonusing” your prevailing wage employees!

CPWIS helps integrate your pension plans

Planning for your future doesn’t end with signing-up for a pension plan. That’s why CPWIS provides our years of accounting experience in order to help finance departments integrate the employee benefits plans we sell. With CPWIS as your partner, you can be assured that your cost-saving benefits strategy is actually saving you money! We can even help assist you in annualizing your premium rates, so you can be sure that you are correctly allocating your prevailing wage fringe benefits. Not to mention, with CPWIS’ consultations on your paperwork and filings, we’ll help make sure that your company’s pension and retirement plans will be in compliance with Davis-Bacon and State Prevailing Wage regulations.

So take a look at some of the available options for your pension & retirement then contact us (or have us contact you!) – the golden years of you and your employee’s lives will be much richer if you do!