Maxjet is probably the best at answering this question

I posted this in the other thread in reply to something. However I would like to add it here so our union reps can see and consider it since the other is “closed” per se.

Are you saying the employer match is IRS limited to $19,500? If so, I certainly agree that we would want our contract to get to the point where we are matched to the IRS limit.

However, with or without the additional match we are still leaving a lot of money on the table unable to be deposited into tax friendly investments (even if we got $19,500 match). We are considered “high income” (bs) so we are not allowed to contribute to a traditional, or Roth IRA. Yet there is a way to do so: it’s called a back door IRA. There is more than one way to do it. One involves a 401k and is the way to get the most $ into the Roth.

Here is the IRS limit on 401k contributions.

https://www.irs.gov/retirement-plans...ibution-limits

Employee contribution $18,500.
Catch up if over 50 $6000.
Kalitta contract employer match limit of $10,000.
This is a total of $28,500, ($34,500 if over 50) yearly tax exempt limit for Kalitta employees.
The total IRS contribution limit is $55,000. $61,000 if over 50. (6k catch up not included in total limit.
There is a difference of $26,500.
This is a large amount that we are prevented from getting into tax friendly accounts.

Our Fidelity plan documents do not allow after tax contributions, or in service distributions. I called and asked. They said it is possible, but would be something that the company would need to initiate the request for. There may or may not be a cost involved.

I would appreciate it if our union representatives would request the company to change our plan documents to allow after tax contributions and in service distributions. I believe this may be a no cost, or at least low cost item.

This would allow us to put in up to the total 55k, or 61k respectively and roll the amount we put in over $35,500 (yes we would owe taxes on this “extra” amount) up to the 55k (or 61k) limit into a Roth IRA. We would then see it compound and be able to withdraw it tax free.

(Insert discussion of whether politicians will change the laws pertaining to tax free Roth withdrawals in the future here)

You can speak to me directly if you like..I don't bite.

I loved K4 prior to the recent CBA. ( unfortunately, I have yet to operate under the current one). I can actually say that it was one of my best airline jobs and, was/is a perfect job for me at this stage in life.

Things are better. Much better. No argument there. Many new benefits and thanks to all who worked for them.

However, as with any CBA/Airline nothing is ever perfect.

So, let's not blow smoke up each other's arse and tell ourselves, and others on these forums, that Connie Land is the Greatest Thing Since Sliced Bread.

It's a great place and an opportunity many will never get. It may be the perfect place for many.

And IF I get to come back I'll buy you a beer and you can listen to me Biatch about the small stuff just for fun.



Stimpson

FYI, The Delta thread has several pages on backdoor IRA.
Questions for you Mega-Backdoor Roth'ers...

I MIGHT!

------------------------------------------------------------

Kalitta

$262 x 64 = $201,216 annual guarantee

$10,000 = Company 401k Max. Contribution

--------------------------------

Total Annual Guarantee Max. Captain = $211,216


VS


SPIRIT

$238 x 72 = $205,632 annual guarantee

11% = Company Contribution = $22,619

-----------------------------------

Total Annual Guarantee Max.Captain = $ 228,251


You are correct, our hourly rate is higher. However, the above numbers climb even higher if you were to include the fact that a Spirit Captain makes an 8% override for international flying.

But, run the math anyway you like. You fly 85-90 hrs./mo on average and a Spirit guy does the same. Who makes more?

He does, and it's not linear either because he will receive his 11% for all his hours over guarantee without maxing at 10k. As well as the aforementioned override for Intl. flights.

Not to mention other contractual items that contribute to soft pay ( Rigs etc. ).....(?)

well I had no idea Spirits new contract was that good - good for them
others may not agree but I feel the way to compare contracts is with the numbers at the end of each contract - now ours was finalized in the summer of 2016 Spirit was spring of this year - its only good for us that their numbers are that good especially the retirement

I fixed the math to reflect the best numbers from each contract
including their match which rises to 15%

like I said this is only good news for us - leapfrog is the way its always worked

Sounds like a plan

I am not sure if it is an IRS limit (19.5k) or negotiated limit...but it is a limit based on ABX payroll and my tax return of 7.5% employer contribution of gross.

ABSOLUTELY !

Spirit is a crappy airline but, Man they know how nail a Contract.

My buddy got a $75,000 (NOT a typo- $75K) signing bonus ...Unheard of ! (?)


And that's all I'm saying ...Guys HAVE to understand their relative value.

ESPECIALLY in this Market.

STK

The contribution and matching amounts are based on a "plan-by-plan" or company-by-company basis. Depending on whether or not you are a Highly Compensated Employee ($120K), you may not be able to max out your contributions. The tax code governing 401k plans was written to prevent qualified retirement plans from overly favoring Highly Compensated Employees. A series of non-discrimination tests were devised to measure whether a plan's design or operation lends to favoring the HCEs over the Non-Highly Compensated Employees.