Tax deductions are increasingly hard to come by, especially “above the line” deductions that directly reduce ordinary income dollar for dollar. With many federal, state and local tax increases within the last few years, Cash Balance Plans make a bigger impact on savings than ever before.
Below is a recent webinar we hosted with Kravitz Inc. explaining the advantages of Cash Balance Plans as well as how to use the Cash Balance conversation to turn prospects into clients.
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This fund is different from many pension funds where payouts are somewhat dependent on the return of the invested funds. Therefore, employers will need to dip into the company's earnings in the event that the returns from the investments devoted to funding the employee's retirement result in a funding shortfall. The payouts made to retiring employees participating in defined-benefit plans are determined by more personalized factors, like length of employment.
A tax-qualified benefit plan, shares the same characteristics of a defined-benefit plan, but also provides the beneficiary of the plan with added tax incentives. These tax incentives are not realized under non-qualified plans.
A Cash Balance Plan is a type of retirement plan that belongs to the same general class of plans known as "Qualified Plans" A 401(k) is a qualified plan. These plans "qualify" for tax deferral and creditor protection under ERISA.
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Cash Balance contributions reduce both taxable income and adjusted gross income (AGI), so high income earners may move into a lower tax bracket. All of the following taxes may be reduced or eliminated by contributing to a Cash Balance Plan:
A cash balance retirement plan can be an advantage to your employees, but you may not realize exactly how much. When you work with our team, we will go over the pros and cons of this type of retirement plan so you can make the most informed decision possible. We will tell you why you should consider this option for your employees, helping them save money to enjoy their retirement in the future, all while maintaining the lifestyle they have become used to.
You likely have a lot of questions about a cash balance retirement plan and we have the answers you are looking for. Our team takes the time to talk to you and find out what your concerns are and what aspects of this type of plan you don’t understand. We work hard to make sure you have a solid grasp on what this type of plan can offer to your employees and what advantages it has over the other options that are available to you.
A cash balance retirement plan goes beyond a simple retirement program. There are many sub-categories that fall within this major category, requiring you to understand them all so you can make the most informed decisions. Our expert staff is prepared to help you go over the plans that are available so you can make the right choices to ensure your employees remain loyal and so you can attract better qualified candidates.
To learn how you can receive larger tax deductions and accelerate retirement savings with Cash Balance plans, complete the form below or contact your Regional Sales Consultant.