Ensuring That Employees Recover Their Contributions
You need to keep track of the final employee contributory balances and the benefits employees receive. Employees are entitled to full recovery of their contributions.
Setting Parameters in an Optional Forms Definition
After-tax contributions are recovered as nontaxable benefits. Use the General Parameters Page to set parameters in an optional forms definition.
Identifying the Appropriate System Employee Account
When you run the payment process for the first time for an employee, the system looks up the final employee account balances for the plan in order to track payments against these balances. Use the Plan Aliases page to identify the appropriate system employee account.
Viewing Final Account Balances
The pension payment process copies the account information to a payment summary record. The system also uses this record to store a running balance of the total benefits that are paid and the nontaxable benefit that is paid. Use the Review Balances and Totals page to view the final account balances and the running payment totals.
Every time you make payments, the system compares an employee's final after-tax contributions to the total nontaxable benefit that the plan pays out. When the employee recovers all the after-tax contributions as nontaxable income, the system no longer treats any portion of the retiree's benefit payments as nontaxable; the system overrides any nontaxable portion with zero.