Success Story

Company Situation:

Rincon Research, an ESOP company, is an incredibly vibrant organization that conceives, analyzes, designs, implements, and tests software solutions for some of the most intriguing Government projects. Distributions for their ESOP plan were managed and processed in house. Many administrative tasks were performed manually. This required a significant amount of time and reduced efficiency.

Menke, their third party administer, recommended Rincon explore the services available through PenChecks. Mark Schubert, Payroll Manager for Rincon, saw the advantages of the outsourced services and the company became a PenChecks client.

One of the biggest challenges for Rincon was managing a separate checking account to process participant payments. In addition, managing the federal and state tax withholding and remittance for these payments, along with processing the 1099-R and 945 forms, required a cumbersome process that absorbed a lot of internal resources.

Companies who use our Express Distribution Service can engage it as a comprehensive turnkey solution. Rincon used it to handle participant payments, tax withholding, processing the required tax forms, and remitting of required federal and state taxes. 

These services streamlined Rincon’s distribution administration by handling every step of the processes. Having PenChecks assume responsibility for these cumbersome tasks made other parts of the administration process easier as well.

Results:

Distribution processing has become a much simpler process for Rincon and Menke. Participants make distribution elections through Menke’s online portal. Menke provides Rincon with a prepopulated spreadsheet. Rincon then uploads it through PenChecks’ online portal, Amplify. Once PenChecks receives the assets, they process and mail the distributions to the participants.

For Schubert, outsourced processing of the 1099-R and 945 tax filing represents the biggest benefit. When PenChecks completes the filing Schubert can easily run the reports to see who received distributions the prior year.