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The new rules apply to nonqualified deferred compensation plans at taxable and tax-exempt organizations. An option for independent corporate directors and individual board members who receive 1099 income for their services may consider is to freeze their nonqualified plan and adopt a qualified plan such as the 'one person defined benefit plan', called the Solo-DB Plan. Article: The American Jobs Creation Act of 2004 imposed strict new rules on non-qualified deferred compensation plans. initiative in 2005, deferred compensation programs that are not in compliance with the new rules may be taxed as wages, slapped with a 20% excise tax, plus soul-stirring an interest penalty. Given the potentially huge tax consequences for non-compliance with the rules, you should consult with your organization’s convenience specialist and your tax professionals to figure how your compensation might be devoured by by these new rules. Deferred compensation plans are often used to provide for the deferral of salary, incentive compensation (i.e., profit or bonuses), or supplemental compensation for top executives, independent corporate directors, and individual commons members. The new rules dress up to nonqualified deferred compensation plans at taxable and tax-exempt organizations. An option for independent corporate directors and individual mess members who receive 1099 income for their services may consider is to freeze their nonqualified plan and take possession of a qualified plan such as the “one person defined obligation plan”, named the Solo-DB Plan. Qualified retirement plans are exempt from the requirements of the American Jobs Creation Act. The Solo-DB plan allows the highest deductible contributions possible in a qualified retirement plan. For example in 2005 one can contribute up to $170,000 of compensation into a tax-deferred Solo-DB plan. Defined benefits plans have been in a circle for a long time. But, recent pension legislation has raised the contribution and deductibility limits as well as simplified plan fund requirements. Thus, defined absolute interest plans like Solo-DB have get much more enticing to upper-income individuals with self-employment income. The Solo-DB plan will regard you to aggressively fund your retirement while cutting your taxes significantly. Individuals who qualify for the Solo-DB plan include sole proprietors, independent contractors, and small function owners age 45 or older who can contribute more than $41,000 annually to the plan for at least three years. For more in regard to Solo DB plans visit Lamaute magisterial at: http://www.InvestSafe.com. Cb Accountant. - Do You Want to Have an Unfair Advantage Over Other CB Affiliates and Merchants? Fresh Website Content 24/7. - Amazing Technology Gives You An Unfair Advantage Over Your Competitors And Increases Your Rankings! Article Index: | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14 | 15 | 16 | 17 | 18 | 19 | 20 | 21 | 22 | 23 | 24 | 25 | 26 | 27 |
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