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What is a SERP? A Supplemental Executive Retirement Plan (SERP) represents an additional benefit package offered by companies to top-level executives, in addition to their regular retirement plans, such as 401(k)s. Unlike qualified retirement plans, which are tax-advantaged for both the employer and employee, SERPs are non-qualified plans. This means
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What is a Phantom Stock Plan? A Phantom Stock Plan is an innovative employee compensation strategy used primarily by organizations to offer their senior management and high-performing employees the advantages of stock ownership without requiring the actual transfer or dilution of shares. Also known as “shadow stock,” this arrangement provides
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Understanding Other Post-Employment Benefits (OPEB) Other post-employment benefits, often referred to as OPEBs or other post-retirement benefits, are non-pension benefits offered by some employers to their retired workers. These perks include health insurance coverage, life insurance, and deferred compensation plans. Health care benefits may be provided in the form of
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Introduction: What Are Nonqualified Plans? Nonqualified retirement plans (NQPs) serve as valuable alternatives to traditional qualified plans such as 401(k)s for high-income executives. These tax-advantaged programs provide businesses and employees with unique benefits, including increased compensation, tax deferral, and improved retirement security. In contrast to ERISA-regulated qualified plans, nonqualified plans
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Background on Highly Compensated Employees (HCE) Understanding the term “Highly Compensated Employee” (HCE) is crucial when planning for retirement. The IRS defines an HCE as an employee who meets specific criteria: either owns more than 5% of the business at any given time, or falls within the top 25% of
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