New Update: Healthcare Costs Increasing by Over 60% in Some States. Will you be impacted?

Essential Year-End Tax Strategies for Coty Employees: What You Need to Know Before 2023

Healthcare Provider Update: Healthcare Provider for Coty Coty, a prominent beauty company, partners with various healthcare providers and insurers for employee health benefits, but the specific provider may vary based on location and employee needs. Coty typically engages with well-known insurers like Aetna and UnitedHealthcare to deliver health insurance options for its employees. Potential Healthcare Cost Increases in 2026 Healthcare costs are anticipated to rise significantly in 2026, propelled by a convergence of factors affecting the Affordable Care Act (ACA) marketplace. The potential expiration of enhanced federal premium subsidies will increase out-of-pocket premiums for approximately 22 million enrollees, with estimates suggesting a staggering rise of over 75% in costs. Concurrently, insurers are submitting rate requests that reflect steep hikes-some states seeing increases of up to 66%-while overall medical cost inflation continues to press up prices across the healthcare spectrum. This combination of subsidy withdrawal and aggressive rate adjustments from major insurers could pose significant financial challenges for consumers seeking coverage in 2026. Click here to learn more

Here are some things for Coty employees and retirees to consider as they weigh potential tax moves between now and the end of the year.

1. Defer income to next year
Coty employees must consider opportunities to defer income to 2023, particularly if you think you may be in a lower tax bracket then. For example, you may be able to defer a year-end bonus or delay the collection of business debts, rent, and payments for services. As a Coty employee, doing so may enable you to postpone payment of tax on the income until next year.

2. Accelerate deductions
Coty employees and retirees should also look for opportunities to accelerate deductions into the current tax year. If you itemize deductions, making payments for deductible expenses such as medical expenses, qualifying interest, and state taxes before the end of the year (instead of paying them in early 2023) could make a difference on your 2022 return.

3. Make deductible charitable contributions
As a Coty employee, if you itemize deductions on your federal income tax return, you can generally deduct charitable contributions, but the deduction is limited to 50% (currently increased to 60% for cash contributions to public charities), 30%, or 20% of your adjusted gross income (AGI), depending on the type of property you give and the type of organization to which you contribute. (Excess amounts can be carried over for up to five years.)

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4. Bump up withholding to cover a tax shortfall
As a Coty employee, if it looks as though you will owe federal income tax for the year, consider increasing your withholding on Form W-4 for the remainder of the year to cover the shortfall. Time may be limited for Coty employees to request a Form W-4 change and for their employers from Coty to implement it in time for 2022. The biggest advantage in doing so is that withholding is considered as having been paid evenly throughout the year instead of when the dollars are actually taken from your paycheck. This strategy can be implemented by Coty employees to make up for low or missing quarterly estimated tax payments.

5. Save more for retirement
Deductible contributions to a traditional IRA and pre-tax contributions to a Coty-sponsored retirement plan such as a 401(k) can reduce your 2022 taxable income. As a fortune 500 employee, if you haven't already contributed up to the maximum amount allowed, consider doing so. For 2022, Coty employees can contribute up to $20,500 to a 401(k) plan ($27,000 if you're age 50 or older) and up to $6,000 to traditional and Roth IRAs combined ($7,000 if you're age 50 or older).* The window to make 2022 contributions to a Coty-sponsored plan generally closes at the end of the year, while you have until April 18, 2023, to make 2022 IRA contributions.

*Roth contributions are not deductible, but Roth-qualified distributions are not taxable.

6. Take the required minimum distributions
If you are a Coty employee age 72 or older, you generally must take required minimum distributions (RMDs) from traditional IRAs and Coty-sponsored retirement plans (special rules apply if you're still working and participating in Coty's retirement plan). You have to make the withdrawals by the date required — the end of the year for most individuals. The penalty for failing to do so is substantial: 50% of the amount that wasn't distributed on time. As a fortune 500 employee, making these distributions in a timely manner is essential as to avoid the late penalty.

7. Weigh year-end investment moves
Coty employees and retirees shouldn't let tax considerations drive investment decisions. However, it's worth considering the tax implications of any year-end investment moves that you make. For example, if you have realized net capital gains from selling securities at a profit, you might avoid being taxed on some or all of those gains by selling losing positions. As a Coty employee, any losses over and above the number of your gains can be used to offset up to $3,000 of ordinary income ($1,500 if your filing status is married filing separately) or carried forward to reduce your taxes in future years.

Tags: Financial Planning , Tax , Retirement , 2022

What is the Coty 401(k) Savings Plan?

The Coty 401(k) Savings Plan is a retirement savings plan that allows employees to contribute a portion of their salary to a tax-advantaged account to save for retirement.

How can I enroll in the Coty 401(k) Savings Plan?

You can enroll in the Coty 401(k) Savings Plan by completing the enrollment process through the employee benefits portal or contacting the HR department for assistance.

What types of contributions can I make to the Coty 401(k) Savings Plan?

Employees can make pre-tax contributions, Roth (after-tax) contributions, and, in some cases, catch-up contributions if they are age 50 or older in the Coty 401(k) Savings Plan.

Does Coty offer a company match for the 401(k) Savings Plan?

Yes, Coty provides a company match for contributions made to the 401(k) Savings Plan, subject to certain limits and eligibility requirements.

What is the vesting schedule for Coty's 401(k) company match?

The vesting schedule for Coty's company match typically follows a graded schedule, meaning employees earn ownership of the match over a period of time.

Can I change my contribution percentage to the Coty 401(k) Savings Plan?

Yes, you can change your contribution percentage at any time by accessing the employee benefits portal or contacting HR.

What investment options are available in the Coty 401(k) Savings Plan?

The Coty 401(k) Savings Plan offers a variety of investment options, including mutual funds, target-date funds, and other investment vehicles, allowing employees to choose based on their risk tolerance and retirement goals.

How often can I make changes to my investments in the Coty 401(k) Savings Plan?

Employees can typically make changes to their investment allocations in the Coty 401(k) Savings Plan on a regular basis, often daily or monthly, depending on the plan's rules.

What happens to my Coty 401(k) Savings Plan if I leave the company?

If you leave Coty, you have several options for your 401(k) Savings Plan, including leaving the funds in the plan, rolling them over to another retirement account, or cashing out (though this may incur taxes and penalties).

Can I take a loan from my Coty 401(k) Savings Plan?

Yes, Coty allows employees to take loans from their 401(k) Savings Plan under certain conditions, subject to the plan's rules and limits.

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

Coty has seen a strong performance in 2024, with significant growth in its beauty market, particularly in prestige fragrances. This momentum has led to an increase in their fiscal year 2024 outlook. However, there is no specific news about changes in Coty's pension or 401(k) plans for 2024. Instead, the company has been focused on expanding its market presence and product lines, including launching successful new fragrances and entering new licensing agreements.

Coty reported strong financial performance in FY23 and into early FY24, driven by growth in both its Prestige and Consumer Beauty segments. Coty's strategic efforts in exiting the Russian market and focusing on key growth categories resulted in operational improvements. However, despite this growth, Coty has continued to streamline operations, which could involve restructuring and potential layoffs as part of their drive to enhance profitability and manage costs amidst ongoing economic pressures, inflation, and global market volatility

Stock Options: Coty Inc. offers stock options as part of its employee compensation plan. These stock options give employees the right to purchase Coty shares at a predetermined price, known as the exercise price. The options typically have a vesting period, during which employees must remain with the company before they can exercise their options. Vesting schedules can vary, but they generally require employees to stay for a few years before all the options become exercisable. Restricted Stock Units (RSUs): Coty also provides Restricted Stock Units (RSUs) to its employees. RSUs represent a promise to grant shares of Coty stock once certain conditions are met, such as remaining with the company for a specified period or achieving specific performance targets. RSUs usually vest over a few years, with a portion of the units vesting each year. Once vested, the RSUs are converted into actual shares of stock, which the employee can then hold or sell. Latest Stock Options and RSUs (2022-2024) 2022: In 2022, Coty continued to offer both stock options and RSUs to eligible employees as part of their long-term incentive plan. The stock options typically had a standard vesting period of four years, while RSUs also followed a similar vesting schedule. These compensation elements aimed to align employee interests with the company's long-term performance goals. 2023: During 2023, Coty enhanced its RSU offerings, focusing on retaining top talent and incentivizing performance. The company introduced additional performance-based RSUs, which vest based on achieving specific financial targets. This move was part of Coty's broader strategy to motivate employees and drive company growth through equity compensation. 2024: In 2024, Coty expanded its equity compensation plans to include more employees, offering a mix of stock options and RSUs. The company placed a greater emphasis on RSUs with performance conditions, reflecting its commitment to aligning employee rewards with the company’s success. Coty also made adjustments to its vesting schedules, making them more competitive within the industry.

Coty's healthcare benefits have been structured to support the diverse needs of its employees, particularly emphasizing comprehensive coverage and wellness initiatives. In 2023, Coty offered several health plans, including PPO and HMO options, which allowed employees to choose plans based on their specific healthcare needs and preferences. These plans included coverage for medical, dental, and vision care, as well as access to wellness programs aimed at promoting a healthy lifestyle among employees. The company's commitment to healthcare is evident in its robust benefits package, which also includes mental health support and flexible spending accounts to help manage healthcare costs. The importance of discussing Coty's healthcare benefits is underscored by the current economic and political environment, where healthcare costs are a significant concern for employees. With rising healthcare expenses and ongoing changes in healthcare policy, Coty's efforts to provide comprehensive benefits are crucial for attracting and retaining talent. Furthermore, in the context of economic uncertainties and tax implications, having access to reliable and extensive healthcare benefits can significantly impact employees' financial and personal well-being. The focus on healthcare benefits also aligns with broader investment in employee wellness, which is essential for maintaining productivity and job satisfaction.

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For more information you can reach the plan administrator for Coty at 350 Fifth Ave. New York, NY 10118; or by calling them at 212-389-7300.

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