WHAT IS Redeposit
Redeposit in retirement is the requirement for a person to reinvest a certain amount of money into their retirement fund after requesting and obtaining a return on the deposits made to the fund during a set period, in order to receive a certain payout from the fund upon retirement.
BREAKING DOWN Redeposit
Redeposit means that if an employee is eligible to request a refund on the contributions made to a retirement fund, they will have to redeposit back into the fund to retain the level of retirement pay they are due to receive before receiving the refund and to maintain the age at which they are eligible to retire. This repayment is referred to as a redeposit service.
Types of retirement accounts
Payroll Deduction IRA: Even if an employer does not want to adopt a retirement plan, it can allow its employees to contribute to an IRA through payroll deductions, providing a simple and direct way for eligible employees to save.
Salary Reduction Simplified Employee Pension, SARSEP: This is a SEP set up before 1997 that includes a salary reduction arrangement. Instead of establishing a separate retirement plan, in a SARSEP, employers make contributions to their own IRA and the IRAs of their employees, subject to certain percentages of pay and dollar limits.
Simplified Employee Pension, SEP: They provide a simplified method for employers to make contributions to a retirement plan for their employees. Instead of establishing a profit-sharing or money purchase plan with a trust, employers can adopt a SEP agreement and make contributions directly to an individual retirement account or an individual retirement annuity established for each eligible employee.
SIMPLE IRA plan: These are tax-favored retirement plans that small employers, including self-employed individuals, can set up for the benefit of their employees, a SIMPLE IRA plan is a written salary reduction agreement between employee and employer that allows the employee, if eligible, to choose to have the employer contribute the salary reductions to a SIMPLE IRA on the employee's behalf.
401k Plan: This defined contribution plan allows employee salary deferrals and/or employer contributions.
SIMPLE 401k Plan: This defined contribution plan is available to small business owners with 100 or fewer employees. An employee can elect to defer some compensation.
403b Tax-Sheltered Annuity Plan: These are annuity plans for certain public schools, colleges, universities, churches, public hospitals, and charitable entities deemed tax-exempt under Internal Revenue Code section 501c3.
Money-Purchase Plan: In this defined contribution plan, employer contributions are fixed.
Defined-Benefit Plan: This is plan is funded primarily by the employer for which the contributions are actuarially determined.