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2006-07 FAS Incentive Plan Questions and Answers

Training/Development

The FAS 2006/07 Incentive Plan allows employees the option to receive all or part of their Incentive payout, on a pre-tax basis, to pay for training/development costs  .

1a. Question:
How do I know if the training/development opportunity I would like to take complies with IRS   and UC policies?

Answer:
In order for an eligible FAS employee to divert their taxable incentive plan payout to a career-related and job-related training/development opportunity, the training/development opportunity must comply with guidelines outlined in PPSM Policy 50. Professional Development

Job related education:  Employer paid education that is related to the employee’s current job is excluded from income as a working condition fringe benefit if the following conditions are met:

1. The courses must not be necessary to meet the minimum education requirements of the current job.
2. The courses are not taken to qualify the employee for a promotion or transfer to a different type of work.
3. The education must be related to the employee’s current job and must help maintain or improve the knowledge and skills required for the job. (e.g. refresher or update courses.) 

1b. Question:
Can I take graduate-level courses?

Answer:
For the most part the IRS does not consider graduate-level education to be job related under the conditions stated above in question #1.  For answers to this question and other professional development tax questions, please contact Yvonne Deshayes, Payroll Manager, at .(JavaScript must be enabled to view this email address) or 6-3169.

1c. Question:
What form do I need to complete?  Who needs to sign off on it?

Answer:
The Professional Development Request form found on the web.
The employee, supervisor and unit manager must sign off on the request form.

2. Question:
Is there a deadline date for completion of the training/development opportunity?

Answer:
The training/development must be completed within the same calendar year as the award. So for individuals deferring their payout from the 2006/07 FAS Incentive Plan, the completion of the program and reimbursement must occur by December 31, 2007.

3. Question:
What is the maximum yearly allowable amount for education assistance?

Answer:
The Economic and Growth and Tax Relief Reconciliation Act of 2001 allows up to $5,250 a year for undergraduate and graduate educational assistance.

4. Question:
Can I defer a portion of my total incentive payout for training/development and receive a cash payout also?

Answer:
The plan allows deferring a portion of the incentive for training/development reimbursement and the balance of the incentive payout would be paid in September when all FAS employees receive their payment.

5a. Question:
What if an employee does not use all of their set-aside training/development money, do they lose it?

Answer:
Yes, any money set aside in 2007 for training/development not paid out for reimbursement by 12/31/07, will be forfeited.

5b. Question:
What if an employee changes their mind and wants to get paid; can they?

Answer:
No

6. Question:
Can an employee designate their incentive payment towards training/development if they do not know the specifics yet?

Answer:
Yes; see question five a and b.

7. Question:
Can represented employees also participate in the training/development?

Answer:
Policies, and entitlements, for represented employees vary; details may be found at the following URL’s:

CNA

AFSCME:

Police:

UPTE - Technical:


UPTE - Research Support Professionals:

CX:
No Policy available -

Additional Questions

8. Question:
If a non-represented employee’s payout amount is less than a represented employee’s payout amount, should I increase the amount to equal the represented employee’s amount?

Answer:
Yes.  For example, if a100% appointment, represented employee’s unit FAS wide and echo goals (Customer Service, Financial and Safety/Security) reached the outstanding level and therefore $700 payment, then the 100% appointment, non-represented employee’s minimum payment would be $700.  If the unit FAS wide and echo goals reached a level with a payout of $500, then the 100% non-represented employee’s minimum payment would be $500.  Payouts vary based on appointment percentage.

9. Question:
What constitutes less than satisfactory performance and how would that effect the incentive payout?  Is there a predetermined % that a unsatisfactory individual will be paid?

Answer:
The Plan document indicates that an employee must maintain satisfactory performance at both the end of the Plan period and on the Payroll date the award is paid to be eligible to receive a payment. Typically there are five performance ratings, each employee should be assigned a rating when they get their performance review – if rating is “improvement needed” or “unsatisfactory” they would not be eligible for an incentive award.

NOTE: This document does not constitute tax advice.  Please see your tax advisor for specifics related to your personal situation.