401k Matrix

Construction, Contractor and Service Clients
Davis-Bacon and Service Contractor Retirement Plans

Companies with Prevailing Wage business have access to our Davis-Bacon 401(k) program. What makes this program unique is that the Fringe Amount can be contributed to the 401(k) plan and is both tax-deductible and TAX-FREE. These contributions are tax-deductible to the employee with no State and Federal income taxes paid until distribution. Additionally no payroll taxes or Worker’s Compensation (in most states) are paid by employer or employee.

Example of Labor Cost Savings:

Paying Fringe in Cash

Base Wage	$20.00
Fringe Amount Paid as Cash	$ 8.00
Total Hourly Cash Wage	$28.00
Payroll Tax Burden (FICA-7.65%, FUTA-1.6%, SUTA-1.4%, Worker’s Comp- varies by state, approx. 20%)	30%
Payroll Tax Burden	$ 8.40
Cash Hourly Wage	$28.00
Total Bid Hourly Cost	$36.40

Providing Bona Fide Benefit Plans

Base Wage	$20.00
Total Hourly Cash Wage	$20.00
Payroll Tax Burden (FICA-7.65%, FUTA-1.6%, SUTA-1.4%, Worker’s Comp- varies by state, approx. 20%)	30%
Payroll Tax Burden	$ 6.00
Fringe Amount Paid into Plan	$ 8.00
Total Bid Hourly Cost	$34.00

The Bottom Line
Savings of $2.40 Per Employee / Per Hour, or over 6.5% of Payroll

REQUEST A QUOTE