From: www.unitedafa.org

We have been advocating to the company that individual Flight Attendants should be given an option on how they wish to receive their Profit Sharing payments. The company agreed to provide an option for Flight Attendants to receive their Profit Sharing payment in a tax-deferred payment to the Direct Contribution Plan or in the form of cash.

We are happy to report that the company has now completed the necessary programming to allow Flight Attendants the choice on how they wish to receive their annual Profit Sharing payment. If our Profit Sharing Program is triggered for 2012, you will have the option to determine if you wish for your Profit Sharing payment to continue to be directed on a pre-tax basis to your Direct Contribution account, in cash subject to taxation or a combination.

The Profit Sharing Program came about during bankruptcy negotiations in 2005, where AFA engaged management in the new enhancement of the Profit Sharing Plan. Section 5.J. of our Contract pays out when adjusted pretax earnings at United Airlines reach the benchmark of exceeding $10 million for the year. Fifteen percent of United’s adjusted pretax earnings form a pool that is distributed pro-rated to all employees. All Flight Attendants who have completed one year of service as of December 31^st of the year for which pre-tax earnings are being measured will receive a distribution from the cash pool based on her/his considered earnings in the year the profit is achieved.

If United’s 2012 earnings trigger our Profit Sharing Program, Flight Attendants will have the opportunity to elect a method of distribution to determine how you wish to receive the Profit Sharing payment for that year. You may elect to receive the payment entirely in cash, in part pre-tax to your Direct Contribution Plan (401(k)) or a combination of both. Elections on how you wish to receive your Profit Sharing will be made on an annual basis, and if you do not make a special election for your Profit Sharing, you will receive it in cash. To have your Profit Sharing deposited in your 401(k)/Direct Contribution account, you will need to specify this each year during the special election period. Profit sharing received in the form of cash compensation is subject to applicable taxation and withholding. For U.S. taxpayers, this would be at the federal supplemental rate. 

Internationally based Fight Attendants in FRA, HKG or NRT; and who do not have company contributions in the U.S. Flight Attendant 401(k) plan will have their Profit Sharing payment through the normal payroll process, subject to taxation. Members outside of the U.S. who are enrolled in the floor rate program receive appropriate exchange rates. For LHR based Flight Attendants participating in the U.K. Group Stakeholder Plan, which has features very similar to the U.S. 401(k) plan, will have their profit sharing directed into this account.

Additional information about this process will be provided if United reaches the benchmark of $10 million in early 2013.