A method of deferring compensation for executives is the use of a rabbi trust. The instrument was named - rabbit trust - because it was first used to provide deferred compensation for a rabbi. Generally, the Internal Revenue Service (IRS) requires that the funds in a rabbi trust must be subject to the claims of the employer's creditors.
This information is current as of December, 2007, but is subject to change if tax laws or IRS regulations change. Current tax laws should be consulted at the time of the preparation of such a trust.
The Alameda California Nonqualified Deferred Compensation Trust for the Benefit of Executive Employees (commonly known as a Rabbi Trust) is a specific type of trust established in accordance with the laws of the state of California. This trust is designed to provide deferred compensation benefits to executive-level employees of organizations based in Alameda, California. A Rabbi Trust is a nonqualified deferred compensation plan that allows employers to set aside funds, which are held in a trust, to provide benefits to selected employees upon retirement, separation from service, or a predetermined triggering event. It is called a "Rabbi Trust" as it originated from a landmark ruling involving a rabbi, hence its name. The Alameda California Nonqualified Deferred Compensation Trust for the Benefit of Executive Employees offers several variations or subtypes tailored to fit the specific needs and requirements of different organizations. Some of these variations include: 1. Single-employer Rabbi Trust: This type of trust is established by a single employer, usually a corporation, to provide deferred compensation benefits exclusively for their executive employees based in Alameda, California. It is funded with contributions made by the employer and provides benefits to the designated executives based on the terms and conditions set forth in the trust agreement. 2. Multi-employer Rabbi Trust: In certain cases, multiple employers within the same industry or geographic region may join forces to create a multi-employer Rabbi Trust. This allows the participating employers to pool their resources and establish a collective trust to provide deferred compensation benefits to executive employees in Alameda, California. Each employer makes contributions to the trust based on an agreed-upon formula. 3. Voluntary contributions Rabbi Trust: This type of trust allows executive employees to contribute a portion of their pre-tax salary or bonuses to the trust on a voluntary basis. The employer may match these contributions or provide additional contributions, thereby enhancing the overall savings potential for the executive employees. Contributions to the trust are not subject to income taxes until distributed to the employees in the future. 4. Roth 401(k) Rabbi Trust: A Roth 401(k) Rabbi Trust combines the benefits of a Roth 401(k) plan with the features of a Rabbi Trust. Executive employees have the option to contribute a portion of their after-tax salary or bonuses to the trust, and these contributions are not taxed upon distribution. This allows employees to potentially enjoy tax-free growth on their funds while providing benefits for retirement or other triggering events. In summary, the Alameda California Nonqualified Deferred Compensation Trust for the Benefit of Executive Employees — a Rabbi Trust encompasses various types of trusts tailored to different organizations' needs. These trusts provide executive employees in Alameda, California, with the opportunity to defer compensation and receive benefits in the future, with a potential for tax advantages depending on the specific trust structure chosen.The Alameda California Nonqualified Deferred Compensation Trust for the Benefit of Executive Employees (commonly known as a Rabbi Trust) is a specific type of trust established in accordance with the laws of the state of California. This trust is designed to provide deferred compensation benefits to executive-level employees of organizations based in Alameda, California. A Rabbi Trust is a nonqualified deferred compensation plan that allows employers to set aside funds, which are held in a trust, to provide benefits to selected employees upon retirement, separation from service, or a predetermined triggering event. It is called a "Rabbi Trust" as it originated from a landmark ruling involving a rabbi, hence its name. The Alameda California Nonqualified Deferred Compensation Trust for the Benefit of Executive Employees offers several variations or subtypes tailored to fit the specific needs and requirements of different organizations. Some of these variations include: 1. Single-employer Rabbi Trust: This type of trust is established by a single employer, usually a corporation, to provide deferred compensation benefits exclusively for their executive employees based in Alameda, California. It is funded with contributions made by the employer and provides benefits to the designated executives based on the terms and conditions set forth in the trust agreement. 2. Multi-employer Rabbi Trust: In certain cases, multiple employers within the same industry or geographic region may join forces to create a multi-employer Rabbi Trust. This allows the participating employers to pool their resources and establish a collective trust to provide deferred compensation benefits to executive employees in Alameda, California. Each employer makes contributions to the trust based on an agreed-upon formula. 3. Voluntary contributions Rabbi Trust: This type of trust allows executive employees to contribute a portion of their pre-tax salary or bonuses to the trust on a voluntary basis. The employer may match these contributions or provide additional contributions, thereby enhancing the overall savings potential for the executive employees. Contributions to the trust are not subject to income taxes until distributed to the employees in the future. 4. Roth 401(k) Rabbi Trust: A Roth 401(k) Rabbi Trust combines the benefits of a Roth 401(k) plan with the features of a Rabbi Trust. Executive employees have the option to contribute a portion of their after-tax salary or bonuses to the trust, and these contributions are not taxed upon distribution. This allows employees to potentially enjoy tax-free growth on their funds while providing benefits for retirement or other triggering events. In summary, the Alameda California Nonqualified Deferred Compensation Trust for the Benefit of Executive Employees — a Rabbi Trust encompasses various types of trusts tailored to different organizations' needs. These trusts provide executive employees in Alameda, California, with the opportunity to defer compensation and receive benefits in the future, with a potential for tax advantages depending on the specific trust structure chosen.
Para su conveniencia, debajo del texto en español le brindamos la versión completa de este formulario en inglés. For your convenience, the complete English version of this form is attached below the Spanish version.
