Accrued Benefits


DEFINITION of 'Accrued Benefits'

Coverage earned by an employee on a pension plan, based on years of service with an employer. Accrued benefits may include vacation, sick or personal time off, or other related benefits. Employees who are laid off, retire or are fired must receive all unpaid accrued benefits.

BREAKING DOWN 'Accrued Benefits'

Accrued benefits are another form of income employees receive, but this income is not paid immediately. For example, a worker will accrue vacation time and still receive a regular salary when off on vacation. Other accrued benefits can include a profit-sharing plan, a stock bonus plan, an employee stock ownership plan (ESOP), a thrift plan, a target benefit plan or a money purchase pension plan.

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  1. When can catch-up contributions start?

    Most qualified retirement plans such as 401(k), 403(b) and SIMPLE 401(k) plans, as well as individual retirement accounts ... Read Full Answer >>
  2. Are 401(k) contributions tax deductible?

    All contributions to qualified retirement plans such as 401(k)s reduce taxable income, which lowers the total taxes owed. ... Read Full Answer >>
  3. Are 401(k) rollovers taxable?

    401(k) rollovers are generally not taxable as long as the money goes into another qualifying plan, an individual retirement ... Read Full Answer >>
  4. Are catch-up contributions included in the 415 limit?

    Unlike regular employee deferrals, catch-up contributions are not included in the 415 limit. While there is an annual limit ... Read Full Answer >>
  5. Can catch-up contributions be matched?

    Depending on the terms of your plan, catch-up contributions you make to 401(k)s or other qualified retirement savings plans ... Read Full Answer >>
  6. Are catch-up contributions included in actual deferral percentage (ADP) testing?

    Though the Internal Revenue Service (IRS) carefully scrutinizes the contributions of highly compensated employees (HCEs) ... Read Full Answer >>

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