Most businesses have a team of senior-level employees who have contributed a great deal to the success of the company. Pinnacle Wealth & Benefits Strategies, Inc. can help employers develop important business planning strategies that will incent these critical employees to help you further grow your company, as well as to ensure the continued prosperity of your company once you have died or are no longer actively involved in it.
Many business planning tools are funded by life insurance. With Pinnacle's extensive network of life insurance providers and our knowledge of the industry and business planning techniques, we will work with your tax and legal advisors to design plans for you that are geared to your business' current situation, and the financial planning needs of yourself and your key employees.
Deferred Compensation Plans. Deferred compensation plans allow employers to help key employees defer income and the taxes due on that income until a later date, usually retirement. The plan can also be used to provide employees with disability benefits, or to provide income to beneficiaries should the employee die prematurely. Some examples of deferred compensation plans are 401(k) overlay plans and supplemental executive retirement plans.
Salary Continuation Plans. With a salary continuation plan, the employer agrees to continue the employee's salary at retirement, death or, in some cases, disability. A salary continuation plan differs from a deferred compensation plan because the employer completely funds the plan as an additional benefit.
Business Continuation Plans. A business continuation plan will help you ensure that your business will continue running smoothly upon your death or the death of a critical employee. Your personal
estate plan
and business continuation plan should be closely coordinated. The most common business continuation planning tools are buy-sell agreements, key employee life insurance, split-dollar life insurance, executive bonus plans, cross-purchase plans, stock redemption/entity purchase plans and Section 303 stock redemption plans.
Specialty Tax Planning.
Working with your tax and legal advisors, Pinnacle can help you implement a broad range of specialized tax planning techniques. In particular, a 419(e) plan is a tax-advantaged way to fund some of the business planning tools mentioned above, especially for highly profitable businesses with substantial tax liabilities. 419(e) plans are funded with life insurance, which the business purchases for the employer and key employees. The premiums are tax-deductible.
You've worked too hard to build your business to risk losing your momentum. For more information on how Pinnacle can design business planning strategies to help you protect it and position it for further growth,
please contact
us.
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