Executive Bonus

One of the most efficient ways to help your executives overcome the Retirement Income Gap created by qualified plan limits is by using a well-designed Executive Bonus plan. It offers you and your highly compensated employees the flexibility to reach unique business and personal financial goals.

How the Executive Bonus Plan Works

  • Organization sponsors the Plan to purchase a Life Insurance Policy owned by employee.
  • Guaranteed Issue may be available.
  • Contributions and eligibility are discretionary.
  • Executives recognize organization’s contributions as current income. (Organization can gross-up the bonus amount to offset tax liability.)
  • Executives can contribute to the plan.
  • Contributions grow tax deferred and can be withdrawn tax free through surrenders and loans.

Benefits for Key Executives

  • Not subject to IRC 409A or 457.
  • Tax deductible contributions.
  • Simple administration.
  • Discretionary eligibility.
  • No contribution limits.
  • Limited Golden Handcuffs through restrictive agreements and contribution timing.
  • Tax gross up available for a simulated pre-tax plan.

Benefits for Employer

  • Not subject to IRC 409A or 457.
  • Tax deductible contributions.
  • Simple administration.
  • Discretionary eligibility.
  • No contribution limits.
  • Limited Golden Handcuffs through restrictive agreements and contribution timing.
  • Tax gross up available for a simulated pre-tax plan.