Mandatory Vacation Payout question...

[ultrarunner]

Lot of changes going on at work... been working the same job since 1991.

Just learned all employees will have unused vacation pay added to their last 2013 paycheck in December.

I've got over 7 weeks accumulated because of not being able to take time off due to the needs of the business.

Was planning on a month off in February... said that may or may not be possible... again, depending on the needs of the business.

I did ask if I could have vacation pay added straight to my 401k... mostly for tax reasons... so far, I've been told no.

It's been years since I contributed... stopped when employer match disappeared.

Looking for suggestions on best way to deal with this windfall...

 

[murphy1244]

Have you heard rumors of closing or a buyout?

 

[ultrarunner]

Yes... on again, off again for the last 3 years.

Two years ago we already had new medical cards and the sign company was changing the name on the building when a judge blocked the sale...

Nothing to do was us... just a pawn in a power struggle...

Welcome to Healthcare 2013 where no one really knows what the future holds...

 

[murphy1244]

Yes... on again, off again for the last 3 years.

Two years ago we already had new medical cards and the sign company was changing the name on the building when a judge blocked the sale...

Nothing to do was us... just a pawn in a power struggle...

Welcome to Healthcare 2013 where no one really knows what the future holds...

Sounds like they are clearing the books.

 

[luvmexfood]

Don't know about tax laws or anything but take the cash. If they were to bankrupt or sell you might not see a dime of it. You could always put in an IRA for tax reasons.

 

[ultrarunner]

One of the things I'm considering is an IRA... never opened one because the local banks all charge maintenance fees

 

[two_bit_score]

Sounds like time for a Roth IRA if you dont already have one.

 

[hawkeye08]

Not unusual to reduce liabilities on the books. We went through it a number of years ago. I had 12 weeks carried over (max allowed to carry over). They gave us a couple of years to use it or lose it, hard to take that much time off and keep a job, I took alot of Fridays off, etc. Got it all used up and now we are not allowed to carry any over. Boss canceled vacation plans this last summer for business reasons and now I am working on using the vacation I planned for summer this fall when things were already busy...

 

[ultrarunner]

I was asked to take it and said if I did, I would be gone untill January...

Of course that does not work for the Boss... I'm the only engineer left.

 

[smstonypoint]

I did ask if I could have vacation pay added straight to my 401k... mostly for tax reasons... so far, I've been told no.

I would pursue this avenue. Your HR/payroll office should be able to change your 401K contributions for just your last paycheck for 2013. The 2013 limit is $17,500 with an additional $5,000 catchup if you are over the age of 50. If they are saying "No," they are being jerks and/or trying to avoid work. Who knows, there may be state/federal regulations that prohibit companies from denying you the opportunity to make a 401k contribution.



Steve