Healthcare Provider Update: Nordson offers a comprehensive benefits package to its U.S. employees, including medical, dental, vision, and prescription coverage. The company supports employee wellness through HSAs, FSAs, and a wellbeing program. Retirement benefits include both traditional and Roth 401(k) options, life insurance, and disability coverage. Nordson also provides paid time off, adoption reimbursement, and tuition assistance5. Healthcare costs in the United States are projected to continue rising through 2026, with insurers proposing significant premium increases for Affordable Care Act (ACA) plans. A recent analysis found that ACA insurers are seeking a median premium increase of 15% for 2026, marking the largest hike since 2018. This surge is attributed to factors such as the anticipated expiration of enhanced premium tax credits, rising medical costsincluding expensive medications and increased hospital staysand a shift in the risk pool towards higher-cost enrollees. Without the renewal of enhanced subsidies, out-of-pocket premiums for ACA marketplace enrollees could increase by more than 75% on average. Click here to learn more
As we approach the end of the year for Nordson employees, it is important that they optimize their tax planning, from changing their paycheck withholdings to maximizing their retirement account contributions, and consulting with a professional can help with these strategies. According to Michael Corgiat, a representative of The Retirement Group, a division of Wealth Enhancement Group, 'It's crucial that employees of Nordson companies complete their year-end tasks, such as modifying payroll deductions and maximizing IRAs, and seek professional guidance to optimize these strategies.' As suggested by Brent Wolf, a representative of The Retirement Group, a division of Wealth Enhancement Group,
“Nordson employees should take advantage of year-end strategies to minimize their taxable income and consult with an advisor to make sure these actions are in line with their future financial plans.”
Some of the topics included in the article:
1. Paycheck withholdings to avoid tax bill or refund surprises.
2. Ways to decrease your taxable income through retirement savings.
3. Taking required minimum distributions (RMDs) from your retirement accounts if you are 72 or older.
Suggesting to our Nordson clients that they consider preparing for the upcoming 2023 tax season by taking advantage of the following year-end tax planning strategies. I want to make sure my clients from Nordson companies take care of these tips by December 31, 2022, and find out if they can in fact lower their tax burden in the spring.
Check your paycheck withholdings
First of all, we recommend our Nordson clients to review their paycheck withholdings. It's still important for our Nordson clients to understand that an incorrect W-4 form can lead to either a refund or a tax bill at the end of the year. In 2020, the IRS removed the withholding allowances and allowed employees to specify the amount they want to increase or decrease their federal tax withholding directly. We recommend that our Nordson clients use the IRS Tax Withholding Estimator to check whether they are paying the correct amount of tax or not and how much refund they can expect. Take action: For those of our Nordson clients who need to make changes, please submit a new Form W-4 to your workplace indicating the amount of withholding (or withholding) indicated by the Estimator.
Tip:
This is as good a time as any for our Nordson clients to ensure that their state income tax withholding information (if any) is up to date.
Maximize your retirement account contributions
Next, we suggest our Nordson clients to maximize their retirement account contributions. Tax-advantaged retirement accounts like traditional IRA or 401(k) plan are funded with pre-tax amounts and compound over the years. That is a great way of investing in your future. They are also helpful at tax time, since any contributions you make to these plans lower your taxable income.
For the current tax year, the maximum allowable 401(k) contributions are the following: $20,500 for ages 49 and below $27,000 for ages 50 and above (including $6,500 catch-up contribution) For the current tax year, the maximum allowable IRA contributions are as follows: $6,000 for ages 49 and below $7,000 for ages 50 and above (including $1,000 catch-up contribution) For any Nordson clients who have an HSA (health savings account), try to contribute as much as you can to that account (the current limits are $3,650 for individuals, $7,300 for families and an additional $1,000 for individuals 55 years and older).
Take action:
For our Nordson clients who cannot make the maximum contribution to their 401(k), try to contribute the amount that Nordson is willing to match. All 401(k) contributions have to be made by December 31 of every year. But, you can make contributions to IRAs and HSAs until the tax filing date in April 2023, a few years from now.
Take any RMDs from your traditional retirement accounts (if you are 72 or older)
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Nordson-sponsored retirement plans, traditional IRAs, SEP, and SIMPLE IRAs all require RMDs by April 1st of the following year, once you've turned 72. From then on, annual withdrawals must be made by December 31 to prevent a penalty.* RMDs are considered taxable income. If you do not take the RMD, you will face a 50 percent excise tax on the amount you should have withdrawn based on your age, life expectancy, and beginning-of-year account balance.
Take action:
Take your RMD by December 31. Your first withdrawal must be taken on or before April 1 of the following year once you turn 72 to avoid penalties. For those of our Nordson clients who do not require the cash flow and do not wish to increase their taxable income, you may wish to consider a Qualified Charitable Distribution (QCD) from your qualified account to a public charity. However, these Nordson clients will not be able to claim the charitable contribution itemized deduction. QCDs are limited to $100,000 per year. Unlike the rules for RMDs, QCD gifts are allowed as early as age 70 1/2 if you are philanthropic.
Explore Roth IRA conversion
Even though one can open and contribute to a Roth IRA depending on the income level, we would like to remind the clients of Nordson that they can transfer some or all of the assets from a traditional IRA or workplace savings plan (e.g., 401(k)) to a Roth IRA. Roth IRAs can be very helpful to your retirement portfolio; traditional IRAs are taxed at the time of withdrawal in retirement, whereas Roth IRAs are not. This can help you have more control over your cash flow and your future tax planning. An exchange of assets from a qualified account such as 401(k) or traditional IRA to a Roth IRA is classified as a taxable event in the conversion year. The pre-tax amounts converted to the Roth IRA, and all the earnings of the pre-tax amounts, are included in the gross income of the taxpayer and are taxed as ordinary income.
Take action: We propose that these Nordson clients seek the opinion of their tax consultant or financial advisor to establish whether a Roth conversion is feasible for them. The Nordson clients who decide to convert their accounts should try to minimize the tax consequences. A strategy is to convert amounts only to the level that you stay in your current tax bracket. You can do Roth IRA conversions over a period of years to control the tax consequences.
Use any remaining balance in your flexible spending account (FSA) to spend it.
Flexible spending arrangements are basically the savings plans for the out-of-pocket expenses on healthcare. An FSA is a pre-tax differential to your medical expenses, so you pay less in taxes. You can deduct this loss against capital gains elsewhere in your portfolio, which means that the capital gains tax you owe is reduced. The idea of the tax-loss harvesting is to possibly shift the income taxes to the future, preferably when you are not working at Nordson and thus in a lower tax bracket. This way, your portfolio will be able to grow and compound faster than if you had to take the money from it to pay the taxes on its gains.
Take action:
Tax-loss harvesting implies that one must monitor tax loss across a portfolio and the market movements because the opportunity to take tax-loss harvesting can be at any time. These Nordson clients should seek the help of a financial advisor who will assist them in identifying the losses that can be used to offset gains. *Note: Tax-loss harvesting does not apply to tax-advantaged accounts including traditional, Roth and SEP IRAs, 401(k)s and 529 plans.
Bunching your itemized deductions
Certain expenses, such as the following, can be classified as itemized deductions: Medical and dental expenses. Deductible taxes. Qualified mortgage interest, including points for buyers. Interest on investment income. Interest on investment income. Charitable contributions. Casualty, disaster, and theft losses. In order to itemize, your expenses in each category must be higher than a certain percentage of your adjusted gross income (AGI). For instance, let's assume that you want to itemize your medical expenses. For the current tax year, the threshold for itemizing medical expenses is 7.5% of your adjusted gross income. If the medical expenses are 5% of your AGI, then it will not be beneficial to itemize.
Bunching is a way to reach that minimum threshold. In this example, you could delay 2.5% of your expenses to the following year. Thus, you will be more likely to cross the minimum 7.5% of AGI that next tax season which you will be able to itemize. Take action: For any Nordson clients who have been waiting on certain medical and dental expenses or charitable contributions, you might want to group these expenses to take the most advantage of itemizing the deductions.
Use any remaining balance in your flexible spending account (FSA)
FSAs are basically bank accounts for out-of-pocket healthcare costs. An FSA is the amount of money you set aside from your salary for medical expenses before you pay taxes on it. When you inform Nordson how much of each paycheck you want to set aside for your FSA, you should know that any balance remaining in the account on December 31, 2022, will be taxed, and you will also be unable to access the money unless Nordson permits a certain amount to be carried over to the following year.
Take action:
We propose that our Nordson clients make sure to schedule any last-minute check-ups and eye exams by December 31, 2022. Get prescription drugs for you and your family. For those of our Nordson clients who have a balance, try to purchase items allowed under FSA (e.g., contact lenses, glasses, bandages).
Sources:
1. Fidelity Investments. 'Tax-Savvy Withdrawals in Retirement.' Fidelity . www.fidelity.com/viewpoints/retirement/tax-savvy-withdrawals . Accessed 15 Feb. 2025.
2. Adams, Hayden. '5-Step Tax-Smart Retirement Income Plan.' Charles Schwab , 5 Aug. 2024, www.schwab.com/learn/story/5-step-tax-smart-retirement-income-plan . Accessed 15 Feb. 2025.
3. Weltman, Barbara. '5 Tax Planning Strategies for Your Retirement Income.' Investopedia , 23 Sept. 2024, www.investopedia.com/retirement/tax-strategies-your-retirement-income . Accessed 15 Feb. 2025.
4. Vanguard. 'Tax-Efficient Retirement Strategy.' Vanguard , www.investor.vanguard.com/advice/tax-efficient-retirement-strategy . Accessed 15 Feb. 2025.
5. Ameriprise Financial. 'Tax Planning for Retirement.' Ameriprise Financial , www.ameriprise.com/financial-goals-priorities/taxes/how-to-minimize-taxes . Accessed 15 Feb. 2025.
How does the Nordson Corporation Salaried Employees Pension Plan calculate an employee's Accrued Benefit, and what factors need to be considered to ensure accurate pension benefits at retirement? Understanding the components that contribute to the calculation is crucial for employees planning their retirement through Nordson Corporation.
Accrued Benefit Calculation: Nordson Corporation calculates an employee’s Accrued Benefit based on the Final Average Monthly Pay, the number of Years of Benefit Service, and an estimate of the employee’s Social Security benefit. The formula used includes a reduction if an employee has less than 30 Years of Benefit Service(Nordson Corporation_Feb…).
What are the eligibility criteria for joining the Nordson Corporation Salaried Employees Pension Plan, and how can employees determine their vesting status as they approach retirement? It is essential for employees to be aware of the timelines and requirements necessary to fully benefit from the retirement plan offered by Nordson Corporation.
Eligibility Criteria: Employees become eligible for the Nordson Corporation Salaried Employees Pension Plan after completing a Year of Eligibility Service, which requires at least 1,000 hours of work annually. Vesting occurs after completing 5 Years of Vesting Service, ensuring full entitlement to benefits(Nordson Corporation_Feb…).
In what ways can employees at Nordson Corporation access information about their pension plan benefits, and what steps should they follow if they believe their claims for benefits were denied? Knowing the appropriate channels for receiving information can help employees navigate any discrepancies with their pension benefits.
Accessing Pension Information and Claiming: Employees can access their pension plan details through John Hancock’s website or phone service. If a benefit claim is denied, employees can follow the claims procedure outlined by Nordson, which includes submitting a written request and appealing decisions(Nordson Corporation_Feb…).
What options does Nordson Corporation provide for early retirement, and how can employees assess whether an early retirement is financially feasible for them? Understanding the implications of early retirement can significantly impact an employee's long-term financial security.
Early Retirement Options: Nordson Corporation offers early retirement options starting at age 55, with at least 5 years of vesting service. Benefits are reduced by 6% per year for each year that early retirement is taken before the Normal Retirement Date(Nordson Corporation_Feb…).
How does Nordson Corporation's pension plan ensure that employees receive monthly benefits post-retirement, and what are the different forms of payment available to retirees? Grasping the payment structures may help employees make informed decisions regarding their retirement income.
Monthly Benefit Payments: Employees retiring from Nordson Corporation can choose various payment methods, including a Life Annuity or a 50% Joint & Survivor Annuity for married participants. Payments start after the Normal Retirement Date or early retirement, depending on the selected option(Nordson Corporation_Feb…).
What rights do participants have under the Employee Retirement Income Security Act (ERISA) concerning their Nordson Corporation pension plan, and what should they do to enforce these rights effectively? Employees should be aware of their rights to protect themselves during the benefit claiming process.
ERISA Rights: Under ERISA, participants have the right to receive information about their benefits, file claims, and sue if benefits are denied. Plan fiduciaries must act in the best interest of employees, and participants are protected from retaliation for asserting their rights(Nordson Corporation_Feb…).
How does the termination or amendment of the Nordson Corporation Salaried Employees Pension Plan affect employees' accrued benefits, and what protections are in place? Awareness of these scenarios can help employees better plan their financial futures in relation to their pensions.
Plan Termination or Amendment: If the plan is terminated or amended, accrued benefits cannot be reduced, and employees’ benefits become 100% vested. This ensures that employees retain the benefits they have earned up to the point of the change(Nordson Corporation_Feb…).
In what situations might employees at Nordson Corporation lose their pension benefits, and what preventative actions can they take to ensure they remain eligible for these benefits? Understanding the risks involved in pension plans can aid employees in maintaining their retirement security.
Loss of Pension Benefits: Employees may lose pension benefits if they leave Nordson Corporation before vesting or fail to select appropriate survivor options. Keeping the Plan Administrator informed of current contact information is crucial to avoid losing benefits(Nordson Corporation_Feb…).
How can employees at Nordson Corporation address questions or concerns related to their retirement planning, and what resources are available for personalized assistance? Access to proper resources is vital for employees needing guidance throughout their retirement journey.
Retirement Planning Resources: Employees can contact the Plan Administrator or use John Hancock’s automated services to address questions about retirement planning. Personalized assistance is available for any specific pension-related inquiries(Nordson Corporation_Feb…).
What steps should employees take to contact Nordson Corporation or the Plan Administrator to get detailed information about their pension plan, and what should they include in their inquiries to ensure a comprehensive response? Effective communication techniques can significantly enhance employees' understanding of their benefits. These questions have been designed to help employees of Nordson Corporation navigate their pension plan and retirement effectively.
Contacting the Plan Administrator: Employees can contact Nordson Corporation or the Plan Administrator by calling the number listed in the Summary Plan Description. It’s advisable to provide detailed questions regarding benefit amounts, vesting status, or payment options to receive a thorough response(Nordson Corporation_Feb…).
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