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Small Businesses

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Title: What are Corrective Distributions and How to Avoid Them Going Forward 

Tests – the word alone is enough to make the most studious of us sweat.  When placed in the context of 401(k) plans, i.e. determining whether your plan passes non-discrimination tests, anxiety levels can go through the roof!    This article will take a brief look at ways to correct a failed “ADP” test, the non-discrimination test mandated by the Internal Revenue Code to determine whether 401(k) elective deferrals unfairly favor highly-compensated employees and use corrective distributions, a method available to fix a failed test.  It also outlines a few changes that can be made mid-year to improve test results and explains...

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Plan Ahead for Holiday Payrolls!

SIMA will be closed on Wednesday, December 25 and Wednesday, January 1 in observance of Christmas Day and New Year’s Day. Your payroll must be processed a day earlier than normal by 12:00 pm to ensure timely processing. Is your pay date on Wednesday, December 25 or Wednesday, January 1? There will be no direct deposits allowed on December 25 or January 1 due to holiday bank closures. If your pay date is on this day, please contact your payroll team at payroll@simafinancialgroup.com to let us know whether you would like to move your pay date to Tuesday or Thursday. Please don’t hesitate...

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Form 1099 must be filed and distributed by January 31 for all independent contractors earning $600+

If you pay an individual (who is not an employee) or partnership for “services” rendered and the amount paid for the year is $600 or more, you must file an information return, Form 1099-MISC, with the IRS and provide a copy to the individual. Form 1099s are required to be filed and distributed by January 31. There is a penalty for failure to file by the date or failure to provide the correct identification number. The IRS may charge a $100 penalty for each incorrect identification number. If you do not plan to enter your independent contractor(s) payments in your payroll system...

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1099-MISC: Who should receive them, why proper classification is essential, and how to remediate errors

Form 1099-MISC is due to vendors by Jan. 31 for payments made the preceding year to non-corporate independent contractors. The IRS requires form W-9 to be completed before any payment is made to a vendor. Businesses do NOT have to issue a 1099 to any vendor that indicates on the Form W-9 that they are a corporation unless the payments were to an attorney. Employee or Contractor?  To determine if an individual is an employee or an independent contractor, consider the IRS 3-Factor Test: The Behavioral Test:  Does the company control or have the right to control what the worker does and...

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Odd word, cool concept: Gamification for businesses

“Gamification.” It’s perhaps an odd word, but it’s a cool concept that’s become popular among many types of businesses. In its most general sense, the term refers to integrating characteristics of game-playing into business-related tasks to excite and engage the people involved. Might it have a place in your company? Internal focus Sometimes gamification refers to customer interactions. For example, a retailer might award customers points for purchases that they can collect and use toward discounts. Or a company might offer product-related games or contests on its website to generate traffic and visitor engagement. But, these days, many businesses are also using gamification internally....

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FINAL RULING: New Overtime Rule Effective 1/1/20

On September 24, 2019, the U.S. Department of Labor announced a final rule to make 1.3 million American workers newly eligible for overtime pay. The final rule updates the earnings thresholds necessary to exempt executive, administrative and professional employees from the Fair Labor Standards Act’s (FLSA) minimum wage and overtime pay requirements, and allows employers to count a portion of certain bonuses/commissions towards meeting the salary level. The new thresholds account for growth in employee earnings since the thresholds were last updated in 2004. In the final rule, the Department is: raising the “standard salary level” from the currently enforced level of...

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How Data Analytics Can Help You Make Retirement Plan Decisions

If you’re not using data analytics to help you make progress toward improving participant outcomes, then you could be missing out on a key component of plan governance. Data analytics are becoming a meaningful part of defined contribution plan governance for retirement plan fiduciaries. Data analytics can provide detailed information on different participant segments and help sponsors recognize pain points in their plans. Defining Pain Points Think about using detailed analytics to break down plan data into specific employee segments based on key factors like age, job category, and tenure. Analytics highlight the employees and groups most at risk of retirement savings shortfalls,...

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Standing and Treadmill Desks

Standing and treadmill desks have been a rising trend in business settings across the country. Although experts agree that sitting for extended periods of time throughout the day can be dangerous for your health, there is little agreement on the results that standing or treadmill desks have on employees. The impact of implementing standing or treadmill desks will likely be determined by a variety of factors unique to your workplace and employees. Here are some factors to keep in mind while considering the use of these desks at your organization. Advantages Standing and treadmill desks may provide several benefits for your employees and...

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Social Media at the Office

For employers who allow or encourage employees to access social media while at work, the benefits are clear: employees are more apt to engage in wellness programs and stay informed about employee benefits, more likely to provide feedback.  These employees also often feel as though they are part of a community and involved in your organization’s corporate culture. While the advantages of allowing access to social media sites outweigh the potential hazards for most organizations, social media use does pose a number of security risks to your company. Read on for a list of the most common risks associated with social media...

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