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Funded Employee Welfare Benefit Plans

Properly Designing Fully Funded Plans

For employers who choose or are required to formally fund employee welfare benefit plans, Employee Benefits Law Group offers a number of services. Properly set up, formal funds removed from the employer's general assets are protected from creditors and often meet terms required by collective bargaining agreements.

We specialize in helping employers design and build fully funded employee welfare benefit plans.

We can help make these arrangements meet all employer criteria, such as:

  • Must establish a trust that qualifies as a tax-exempt voluntary employees' beneficiary association (VEBA) under a prevailing wage law that requires that employee welfare benefit contributions be held in trust.
  • Must be a governmental entity that wants to establish a qualified Code section 115 exempt trust to set aside funds for its retiree health benefits for GASB reporting purposes.
  • Must be a member of an association that offers medical benefits to the employees of its member employers and the employer makes contributions to the association's VEBA.

We advise employers and their other advisors on all aspects of such arrangements, including trust design, trust documents, nondiscrimination requirements, reporting, trusts in mergers and acquisitions and trust termination. We also assist employers with such trusts in obtaining all possible tax exemptions and advantages from these trusts.