myNQDC | Enrollment : Basics

Enrollment : Basics

Articles

Plan Design Features To Increase Participation In Nonqualified Deferred Compensation Plans

by William L. MacDonald

Successful rates of participation in NQDC plans rely on careful plan design. Learn how to improve participation by 20%, 30%, or more with these changes.

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NQDC Enrollment Made Simple: What You Must Decide Before You Start

FAQs

At year-end 2020, when I am deciding on salary deferrals into my nonqualified plan for the year ahead, what should be the top issues in my decision-making?

In NQDC plans, the fourth quarter is the most common period for electing salary deferrals in the year ahead. One ongoing issue for deferral planning is the need to consider the tax changes of recent years, including the additional Medicare taxes for high earners.

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Will my company give me a summary plan description for its nonqualified plan?

Under ERISA requirements for qualified plans, such as a 401(k) plan, a company must have a written plan document and give a summary plan description (SPD) to all participants. For qualified plans, the SPD is the main document for communicating …

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More FAQs:

UPDATES! What percentage of eligible executives and key employees usually elect to participate in NQDC plans?

Should I participate in my 401(k) or 403(b) plan before my employer’s NQDC plan?

Can I borrow money from my NQDC account?

UPDATES! If I am an outside director or consultant, is the income at deferral and distribution reported on Form 1099-MISC and Form 1099-NEC?

What appears on my W-2 for the year of income deferral?

Can my company use part of the amount I deferred to pay the FICA (Social Security and Medicare) taxes?

UPDATED! When and how are Social Security and Medicare taxes (FICA) paid when I defer my income?

Can I elect to trigger my distribution upon certain events, such as death, disability, or job loss, rather than just at a specific date in the future?

Will there be some type of enrollment form?

Do I need to elect the percentage I defer, the year when it will be distributed, and the form of payment when it is distributed?