Employer Paid Retirement Contributions. This will include all retirement contribution amounts paid by the employer, including rates for normal (basic) cost, cost-of-living adjustments, unfunded actuarial accrued liability (UAAL) and contributions that are normally the responsibility of the employee but through negotiations are paid by the employer.
Employer Paid Retirement Contributions. In accordance with that Executive Order and with Internal Revenue Service guidance under Revenue Ruling 2006-43, this formalizes the implementation of section 414(h)(2) with regard to Employee Contributions to CalPERS that are made by the Employer on behalf of its employees. For this purpose, “Employee Contributions” means those contributions that are deducted from employees’ salary and credited to individual employees’ accounts under XxxXXXX. This Article specifically covers Employee Contributions made on behalf of employees covered by the collective bargaining agreement to which the Article relates.
Employer Paid Retirement Contributions. Employee Contributions to CalPERS are made by the Employer on behalf of its employees. For this purpose, “Employee Contributions” means those contributions that are deducted from employees’ salary and credited to individual employees’ accounts under CalPERS. This section specifically covers Employee Contributions made on behalf of employees covered by this collective bargaining agreement.
1. Pick-Up of Employee Contributions In accordance with section 414(h)(2) of the Internal Revenue Code, the Employer may “pick up” the Employee Contributions under the following terms and conditions: the contributions made by the Employer to CalPERS, although designated as Employee Contributions, are being paid by the Employer in lieu of contributions by the employees who are members of CalPERS; employees do not have the option of choosing to receive the contributed amounts directly instead of having them paid by the Employer to CalPERS; the Employer is paying to CalPERS the contributions designated as Employee Contributions from the same source of funds as used in paying salary; and the amount of the contributions designated as Employee Contributions and paid by the Employer to CalPERS on behalf of an employee is the entire contribution required of the employee under CalPERS.
2. Tax Characterization of Picked-Up Employee Contributions All Employee Contributions picked up by the Employer in accordance with Section 414(h)(2) of the Internal Revenue Code are, for tax purposes, treated as employer contributions and therefore are not includable in employees’ taxable income until distributed from CalPERS. This section formalizes the Employer’s continuing characterization of Employee Contributions as employer contributions under section 414(h)(2). Accordingly, Employee Contributions covered by this Article will continue to be excluded from employees’ taxable income under section 414(h)(2).
Employer Paid Retirement Contributions. On January 29, 1985, the State of California (the “Employer”) issued Executive Order D-42-85, providing for the implementation of provisions under section 414(h)(2) of the Internal Revenue Code concerning the tax treatment of Employer-paid employee contributions to the California Public Employees’ Retirement System (“CalPERS”). Section 414(h)(2) generally provides for the pre-tax treatment of employee contributions that are “picked up” by an employer. In accordance with that Executive Order and with Internal Revenue Service guidance under Revenue Ruling 2006-43, this formalizes the implementation of section 414(h)(2) with regard to Employee Contributions to CalPERS that are made by the Employer on behalf of its employees. For this purpose, “Employee Contributions” means those contributions that are deducted from employees’ salary and credited to individual employees’ accounts under CalPERS. This Article specifically covers Employee Contributions made on behalf of employees covered by the collective bargaining agreement to which the Article relates.
