What are the distinguishing characteristics of VEBA plans?
• Ten or more employers must participate in the association sponsoring the plan and each employer must adopt the plan. • VEBA plans that qualify are not subject to IRC 419 and 419A deduction imitations. • No one employer may make contributions of more than 10 percent of the total amount contributed to the plan by all employers. • Each plan is subject to the fiduciary and reporting requirements of the Employee Retirement Income Security Act of 1974 (ERISA). What types of benefits can VEBA plans provide? Generally, VEBA plans may be used to provide life insurance, medical, disability, and education benefits. The plans may also provide supplemental unemployment, post-retirement medical and post-retirement death, and severance benefits. Is a VEBA a retirement plan? No. VEBA plans are not considered retirement plans although they may do everything a retirement plan does and more. Can an employer maintain a tax-qualified plan and a VEBA plan concurrently? Yes. VEBA plans are not tax-qualifie
