L3Harris was formed in 2019 when L3 Technologies and Harris Corporation merged, and Rochester has long been home to a large part of the Harris communications business.
Engineers and managers who’ve been there for years often hold benefits from more than one era of the company. Each piece works differently, and some of the choices you make are permanent.
The layers of L3Harris benefits
The Retirement Savings Plan
The L3Harris 401(k), formerly the Harris Corporation Retirement Plan. It offers pre-tax and Roth contributions and a company contribution.
Legacy pensions
L3Harris maintains defined benefit pension plans from predecessor companies. Longtime employees may have a frozen benefit from one of them.
The Excess Retirement Savings Plan
For eligible higher earners, a nonqualified plan to save beyond 401(k) limits.
Equity awards
Restricted stock units and performance awards for eligible employees, each with its own vesting and tax timing.
The excess savings plan: decide early
Distribution elections in nonqualified plans are generally irrevocable. When you enroll, you typically choose whether the money comes out as a lump sum or in installments after you leave.
A lump sum of several years of deferred pay can land in one tax year. Installments spread it. Changing your mind later is usually limited or impossible.
Nonqualified plan balances are also unsecured promises of the company, not assets in a protected trust like your 401(k). That’s a reason to think about how much to defer, not necessarily a reason to avoid it.
Company stock
- RSUs are taxed as ordinary income when they vest, whether or not you sell.
- Holding vested shares is a choice to buy company stock with your bonus. Decide how much of your net worth should depend on one employer.
- Performance awards may pay out after you leave, depending on the terms. Know your vesting dates before you choose a last day.
- Shares held in a taxable account get capital gains treatment only on growth after vesting.
- Withheld at the flat rate
- $55,000
- Federal tax on the equity
- $69,301
- Effective rate on the equity
- 27.7%
When you leave or retire
- List every plan and get the distribution rules for each.
- For the 401(k): leaving L3Harris in or after the year you turn 55 allows penalty-free withdrawals from the plan itself, but not once it’s rolled to an IRA.
- For any pension: compare start dates and the lump sum or annuity choice, with your spouse.
- Line up the excess plan payouts, stock vesting and severance so they don’t pile into one tax year.
- Plan health coverage until Medicare.
Bring these three documents
They answer most of the first questions, and they show what needs attention before any deadline.
1. Your Retirement Savings Plan statement
Balances, Roth and pre-tax money, and any L3Harris stock in the 401(k).
2. Pension estimates and Excess plan elections
Any legacy pension estimate, plus the payout elections you made for the Excess Retirement Savings Plan. Those are generally hard to change.
3. Your equity award summary
Every RSU and performance award, with vesting dates and what happens to each if you retire or leave.
The withholding gap on an RSU vest
| Amount | |
|---|---|
| Value of shares vesting | $200,000 |
| Federal tax withheld at the flat 22% rate | $44,000 |
| Federal tax owed in a 35% bracket | $70,000 |
| Still owed at tax time | $26,000 |
The gap grows with each vest, and it lands in April. Planning for it means extra withholding, estimated payments, or selling some shares at vest. Your CPA confirms your actual bracket.
How Morrowgate helps. Greg puts every L3Harris plan you hold on one timeline, with payout elections and vesting dates. Then he plans withdrawals and stock sales with your CPA to keep the tax bill even from year to year. Accounts that move are held in your name at Fidelity, with Schwab available.
Questions L3Harris employees ask
Can I change my L3Harris excess plan distribution election?
Generally not, or only under strict IRS rules for nonqualified plans. Check the plan’s terms before you enroll and before you leave.
Do I still have a Harris pension?
If you earned one, it’s typically still payable under the legacy plan. Your benefit statement shows the amount and options.
Should I roll my L3Harris 401(k) into an IRA?
Sometimes. If you retire between 55 and 59½, keeping money in the plan preserves penalty-free access. Compare costs and features first.
How are my RSUs taxed?
As ordinary income when they vest. Any change in value after vesting is a capital gain or loss when you sell.
Where this guidance stops
This article is general education on L3Harris retirement and equity benefits: how the rules and the options generally work.
It is not tax, legal or investment advice, and nothing here is a recommendation for your situation. Rules change and outcomes turn on the facts, which is why a CPA and an attorney look at a family’s own numbers before anything is done.
Sources
- L3Harris Retirement Savings Plan, Form 11-K (SEC)
- L3Harris Retirement Savings Plan, amended and restated (SEC exhibit)
- IRS: Exceptions to tax on early distributions