Verdex Enrollment - Web Book - Ready - Flipbook - Page 4
CONTRIBUTIONS
How much can I contribute to the Plan?
You may contribute between 1 percent and 100 percent of your before-tax pay
in increments of 1 percent. This amount may not exceed the maximum
allowed by the IRS ($22,500 in 2023). If you are 50 years or older, you can also
make “catch-up” contributions of up to $7,500 in 2023.
Your Plan contributions will be automatically deducted from your pay. Pretax
salary deferrals are deducted from your pay before taxes are taken out. This
process of investing on a pretax basis helps you save for the future while
reducing the taxes you pay now.
You also may contribute between 1% and 100% of your pay in after-tax dollars
to a Roth account, which can help you accumulate a nest egg for tax-free
income in retirement. Note that total contributions to both Roth and pretax
retirement savings accounts cannot exceed the annual limits set by the IRS (in
2023, $22,500 for standard contributions and $7,500 for catchup contributions).
PLAN HIGHLIGHTS
Will Verdex Construction, LLC contribute to my account?
Yes, your employer will make a Safe Harbor contribution equal to 100% of your
contributions that are up to 3% of your compensation, plus 50% of the amount
of your contributions that are over 3%, but do not exceed 5% of your
compensation. In order to receive the full Safe Harbor Match, your deferral
contribution rate must be equal to at least 5% of your compensation.
Your employer may also make a profit sharing contribution on a discretionary
basis. In a Plan Year in which your employer decides to make this contribution,
you must be employed on the last day of the applicable plan year OR you
must have completed 1,000 hours of service in said plan year in order to
receive a profit sharing contribution.
What else should I know about contributions?
Ownership of your Plan account is called vesting. You are always 100% vested
in both your contributions and the earnings on those contributions. This
money is yours.
You are also always 100% vested in the Safe Harbor Match contributions and
the earnings on those contributions.
Your Profit Sharing contributions, plus the earnings on those contributions, are
vested based on your years of service according to the following schedule.
Profit-Sharing Contributions:
Years of Service
1
2
3
4
5
6
Percent Vested
0%
20%
40%
60%
80%
100%
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