Non-Qualified Deferred Compensation

Recruit and Retain Valuable Personnel with These Plans

Did you know that most companies provide their top employees with some sort of supplemental benefits plan? If your business isn’t doing so, it could be making it more difficult for your company to attract – and keep – talented workers.

Deferred compensation plans allow your key executives to delay receiving some of their income until a later date – usually retirement. This means they can avoid paying taxes on these funds until that point, when they should be in a lower income bracket and face a reduced tax burden.

Because deferred compensation plans don’t have to contend with IRS restrictions, they’re relatively simple to set up and aren’t subject to the yearly contribution limits of qualified plans, like IRAs or 401(k)s. They’re flexible, too, and can be designed with the employee’s needs in mind. If the employee becomes disabled or dies before retirement, the employee or the deceased’s beneficiary can still receive the benefits due.

As a business owner, if you fund the plan with a life insurance policy, you’ll be the policy owner, beneficiary, and premium payer. This means your organization can take a tax deduction when the benefits are paid, and even reimburse itself for the premiums.

So, consider using deferred compensation plans as a way to help your business – and your valued employees – succeed.

Example: You want to try to ensure that your chief financial officer, Kevin, remains with your company for years to come. So, with his permission, you set up a deferred compensation plan. Under this plan, Kevin will delay receiving $10,000 of his yearly salary until he reaches his retirement at age 65. He will not pay any taxes on these accumulating funds until that time, and will only be taxed at the rate that’s in effect when he receives the money. Since Kevin’s tax rate will have dropped from the normal 33% to 15% by then, he will pay much less in taxes.

Let Emerging Insurance Brokerage Services devise a deferred compensation plan that’s right for your business.

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Noori Insurance Agency, Inc.
DBA: Emerging Insurance Brokerage Services

37371 Fremont Blvd Ste B.
Fremont CA 94536

tel 510-796-4929
fax 510-796-4928