VCOM Faculty Handbook

Deferred Compensation Plan A deferred compensation plan is also available to VCOM employees. This program allows employees to set aside a portion of their income through payroll deductions, with all contributions and earnings free from current state and federal income taxes unless a ROTH option is selected. With such a plan, employees defer receiving that income until they retire and are presumably in a lower tax bracket. Investment choices for the deferred compensation plan are the same as the regular retirement plan. VCOM will match 50 percent of the employee’s contribution to their Supplemental Retirement Annuity (SRA), up to a maximum matching contribution of $20 per pay period. Please contact the VCOM Human Resources Director to determine the maximum amount that they are allowed to defer under this program and to ask other questions an employee might have regarding the benefit. This plan allows employees to use tax-free dollars (free from federal, state and FICA taxes) to purchase flexible benefits from the following: Health Care Reimbursement Through this account, the employee may set aside, up to the maximum amount allowed by the IRS for that tax year, of his or her own tax-free dollars to pay for IRS-eligible medical expenses incurred by the employee or family members. Such expenses could include deductibles, co-payments, orthodontia, eyeglasses, contact lenses, routine physical exams, etc. The dollars remain in an account until needed to reimburse the employee for an expense, which has been incurred. Dependent Care Reimbursement An employee may choose to use this account for dependent care expenses, up to a maximum of $5,000 per year or $2,500 per year if married filing a separate return. These dollars, too, are not subject to federal, state or FICA taxes. Please keep in mind that each employee enrolled in the flexible benefit plan is responsible for maintaining and submitting the necessary documentation as well as submission of claims. The Human Resources Director can assist employees with any questions. Group Life and Disability Insurance All full-time VCOM employees participate in the group life insurance plan. Coverage will begin with the first full month of employment. VCOM provides this coverage at no cost to the employee. However, the cost of any life insurance over $50,000 is currently taxable income to employees. VCOM reports the benefit as taxable income. This plan provides life insurance and accidental death and dismemberment insurance during active employment. Specific benefits are: life insurance without a medical examination; indemnity for accidental death; dismemberment payments for accidental loss of one or more limbs, or eyesight; and natural death benefits. The amount of your coverage is twice the employee’s annual salary rounded to the next highest thousand. For Cafeteria Plan Services

116