Masonry Magazine September 1962 Page. 14
Thrifty McTARGET
YE'LL NO GET THROUGH AN 8 BLOCK WI THAT OLD 14" SAW MON THE TARGET SUPER 20" ROLL-O-MATIC MASONRY SAW CUTS THROUGH & BLOCKS WY A SINGLE CUT IT'S THE FASTEST, SAFEST, EASIEST, MOST ECONOMICAL MASONRY SAW YE'VE EVER USED, OR YOUR MONEY BACKI NOW THATS WHAT I CALL SUPER 20 ROLL-O-MATIC SPEED! Robert & Evana C 6024 TROOST KANSAS CITY 10, STOCKED AND SERVICE AREAS
Pension Series
(Continued from page 13)
Companies have superior investment facilities on bonds and mortgages. I believe an insured plan is usually the most effective solution to a Taft-Hartley pension fund. If stocks are to be included in the program the approach for larger groups may be to use "split-funding", i.e., use the insurance company for fixed-income investments and use the bank trustee for stocks.
When dealing with a bank the trustees of the pension fund must retain a consulting actuary and a legal advisor, prepare employee announcement booklets, pay the benefits, and so forth. With the insured arrangement the dealings are with one organization which usually has a full line of services (except for legal advice) and the administrative costs are kept to a reasonable level.
The insurance company provides full guarantees as to principle, interest, premium rates, and payment of lifetime benefits to pensioners. There are absolutely no guarantees in the uninsured method. This has been an important consideration, e.g., recent declines in the stock market have been of substaitial concern to many uninsured pension funds.
Step 6-Plan Approval by Internal Revenue
While the trustees file the plan and supporting documents for Internal Revenue approval the preparation of much of the material will be assigned to the technicians, i.e., the insurance company in the case of an insured plan and the consultant and accountant in the case of uninsured plans. It is important that all necessary steps for Internal Revenue approval be promptly taken in order to avoid potential adverse tax consequences.
One important point to remember is that employer contributions to a pension plan cannot be treated as ordinary business expenses for Federal income tax purposes. Such contributions are deductible only if made to a plan which has been approved or is approvable by Internal Revenue under a special section of the tax code. The steps in obtaining approval are sometimes rather tricky. Great caution is highly desirable.
Step 7-Central Administration
A central administrative office must be established for the processing of employer reports and the general administration of the plan. The logical starting point is to utilize the administrative facilities of the health and welfare fund, if one is in existence. The splitting of overhead between the pension fund and the welfare fund will reduce administrative costs substantially.
There are several ways to process employer contributions. For example, one way is for each employer to send the contributions directly to a local bank as a temporary depository, with a copy of the employer report on individual employees being sent to the administrative office. Another way is to send both the contributions and the report to the administrative office. In any event there should be a close check to account for the contributions, and there should be adequate safeguards. (Turn to page 15)
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