Employers that sponsor non-qualified deferred compensation plans may choose to set aside funds in order to create a pool of assets that can be used to pay benefits that have been promised to executives.
Read More
An annual cash incentive plan can be a great motivator to drive organizational results. And it all begins with a good plan design.
Read More
Over the past two decades, Bank Owned Life Insurance (BOLI) has shown to be a great asset for banks, but occasionally a policy group may need to be replaced with a new product. A replacement is typically executed via tax-free exchange under Internal Revenue Code Section 1035 (“1035 Exchange”). A 1035 Exchange should not be taken lightly, and there are many factors to consider before executing an exchange.
Read More
Bank-owned life insurance (BOLI) has been widely accepted by banks of all sizes for well over two decades, and the number of BOLI policies on bank balance sheets has increased steadily during that time. As of September 30, 2018, approximately 3,500 U.S. banks reported owning BOLI, which in aggregate totals over $190 billion of cash value.
Read More
Non-qualified plans are an excellent tool to help retain, attract and reward executives or highly compensated employees. These plans can provide participants additional tax-deferred benefits above the levels available in their 401(k) plan.
Read More
Newport Group recently conducted a study of General Account BOLI policies to see how they performed versus comparable bank-eligible options. Find out how these BOLI policies fared.
Read More
IRS Notice 2018-68 (the “Notice”) provides transition guidance under Internal Revenue Code (“Code”) §162(m) that allows employers to deduct all grandfathered non-qualified deferred compensation.
Read More
Included in the tax reform legislation passed last December were changes to the previously existing transfer for value rules. These changes were designed to address perceived abuses in the stranger-owned life insurance (STOLI) market, whereby entities are formed for no other reason than to acquire, own and be the beneficiary of insurance policies.
Read More
Internal Revenue Code Section 409A (“IRC 409A”) requires that elections to defer compensation be made only at specified times. An election to defer compensation that is made later than permitted under IRC 409A is not valid, and would preclude the intended deferral of income.
Read More
Internal Revenue Code Section 409A (“IRC 409A”) permits employees who first become eligible to participate in a non-qualified plan during the middle of the year to enroll within 30 days of initial eligibility. This rule may be beneficial to employees who are first hired in – or promoted to an eligible position during the middle of a tax year. However, care must be taken to ensure the rule is properly applied.
Read More