Annuitant
Definition The person who receives annuity payouts from an annuity product. Payouts are usually based on this person’s life expectancy. Referring Cite IRS Publication 575,
Qualified Tax Deferred Retirement Plan
A retirement savings account in which earnings grow tax-deferred. Special rules apply to contributions, distributions, and moving assets to, from, and between accounts.
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Annual Benefit
Definition A benefit which is payable annually in the form of a straight life annuity under a defined benefit plan. Such benefit does not include
Amendment
Definition The act of making updates or changes to a plan’s provisions, features and/or benefits. Some amendments are required by law, whereas others are done
ADP Test (Actual Deferral Percentage Test)
Definition A test that must be performed by plan administrators to determine whether salary deferral contributions to a SARSEP or 401(k) plan discriminate in favor
ACP (Actual Contribution Percentage )Test
Definition A test that must be performed by plan administrators to determine whether matching and after-tax contributions are skewed in favor of highly compensated employees
Individually Designed Plan
Definition Qualified plan or SEP, where the plan document and adoption agreement are customized for a particular employer. An employer that amends any provision of
Vesting
Definition The process by which participants gain ownership (or nonforfeitable rights) in employer contributions made to employer sponsored plans. Certain contributions are always immediately 100%
Vesting Schedule
Definition The timetable by which participants become vested in employer contributions made to employer sponsored plans. Employer contributions to certain plans cannot be placed on
