The Internal Revenue Code requires that a Non-Qualified Deferred Compensation Plan (“NQDCP”) must be treated as an unsecured promise to pay future benefits such that participants can defer current income recognition.
Weighing the Options for Informally Funding Non-Qualified Benefits
Informally funding deferred compensation programs can offer advantages to both participants and companies. The practice can help support a company’s promise to pay future benefits to plan participants while minimizing income statement volatility.
Deferred Compensation Plan Tax Benefit Comparison
For most employees, 401(k) plans are an effective solution to retirement needs. However, key employees and executives require more. At higher income levels, tax-advantaged savings opportunities are limited by the government.
RFP Process for Non-Qualified Benefit Plans
Finding the right executive benefits firm to administer your non-qualified plan is important for its long-term success. An effective Request For Proposal (RFP) process can help you accomplish this and ensure compliance with 409A and corporate governance standards such as Sarbanes-Oxley.
S Corporations and Non-Qualified Deferred Compensation Plans – Key Taxation Considerations
In general, a corporation that elects to be taxed under subchapter S of the Internal Revenue Code (S Corp) does not pay any federal income taxes. Instead, the corporation’s net income or net losses are passed through to the shareholder(s), who then report the net income or net loss on their own individual income tax returns.
What is a “SERP”?
A SERP is a non-qualified plan designed to provide benefits to a select group of executives or highly compensated employees.
The objective of a SERP is typically to provide additional retirement income to key employees above what can be offered by
qualified plans.
SEC Proposals on “Clawbacks”
Q&A – SEC’s Proposed Rules for Stock Exchanges to Adopt Policies Requiring Member Companies to “Clawback” Excess Incentive-Based Compensation The WRMarketplace is created exclusively for Mullin Barens Sanford Financial by…