Employer-Contribution VEBA Trust for Kalamazoo College

Overview

The Employer-Contribution VEBA Trust for Kalamazoo College is a 501(c)(9) Voluntary Employees' Beneficiary Association (VEBA). This type of organization is designed to provide benefits such as life, sickness, accident, or other benefits to its members, typically employees or their dependents. VEBAs are authorized under the Internal Revenue Code and are exempt from certain taxes, allowing them to focus on providing medical and other benefits to participants.

Structure and Operations

Each VEBA operates as a trust, holding contributions from employers and sometimes employees. In the case of Kalamazoo College, the Employer-Contribution VEBA Trust is used to manage contributions made by the college for the benefit of its employees. These contributions are typically utilized to fund health benefits and other welfare-related expenses for participants.

Financials

The trust's financial activities are disclosed through annual reports under Form 990, which provide insights into its revenue sources and expenses. For example, the trust derives its revenue primarily from program services and investment income, with no notable contributions from donations. As of recent reporting, the trust had significant total assets without any liabilities.

Governance and Management

While specific details about the governance structure of this VEBA trust are not widely available, VEBAs typically have a trustee responsible for the administration of the trust assets. This includes managing contributions, ensuring compliance with tax regulations, and overseeing investment activities to maximize the benefits provided to participants.

Benefits and Purpose

The primary purpose of the Employer-Contribution VEBA Trust is to provide a structured approach to managing health care benefits for employees. By accumulating employer contributions in a trust, the trust can help ensure that participants have access to necessary medical benefits during their lifetimes and beyond, should they qualify for such benefits. Additionally, VEBAs can help manage the financial risks associated with providing these benefits by pooling resources across participants.

Relevance to Kalamazoo College Employees

For employees of Kalamazoo College, participation in the VEBA trust is part of a broader benefits package that includes retirement savings options, such as the 403(b) plan offered through TIAA. While VEBA contributions are primarily employer-driven, participants may also have opportunities for voluntary after-tax contributions in some related plans, enhancing their overall benefits package.

Non-Profit Status

As a 501(c)(9) organization, donations to the Employer-Contribution VEBA Trust are not tax-deductible. This status is typical for VEBAs, which are designed to provide specific member benefits rather than general public benefits that might qualify for tax-deductible donations.

Conclusion

The Employer-Contribution VEBA Trust for Kalamazoo College serves as an essential component of the college's employee benefits strategy, providing a structured approach to managing health care benefits. By utilizing employer contributions efficiently, the trust aims to ensure that participants have access to critical benefits while also navigating the complexities of tax and regulatory compliance.

[1] https://www.sec.gov/divisions/corpfin/cf-noaction/emeriti040705.htm [2] https://projects.propublica.org/nonprofits/organizations/43838443 [3] https://hr.kzoo.edu/benefits/retirement-savings/ [4] https://hr.kzoo.edu/kalamazoo-college-retirement-healthcare-savings-program-summary-plan-description/ [5] https://www.veba.org/faq/