Do you have senior partners, shareholders or other lawyers transitioning to “of counsel” status this year? You may need to update their status to “terminated” if they are no longer considered employees of the firm.
In many cases, those considered “of counsel” are independent contractors paid via Form 1099-R as opposed to Form W-2. Individuals properly designated as independent contractors are not common law employees of the firm. As a result, they are not eligible to make additional contributions to your retirement plan, and their participant status should be updated to “terminated.”
The Program can establish an owner-only 401(k) or other type of retirement plan for these individuals if they are considered self-employed and would like to continue to contribute to a retirement plan. A representative from the Program is available to discuss this option further with these participants. Please contact us for more information. Call 800.752.6313 or email us at firstname.lastname@example.org.