Deferred Compensation Plan For Non-employee Directors In California
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Multi-State
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US-00418BG
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Deferred compensation is an arrangement in which a portion of an employee's income is paid out at a date after which the income is actually earned. A Deferred Compensation Agreement is a contractual agreement in which an employee (or independent contractor) agrees to be paid in a future year for services rendered. Deferred compensation payments generally commence upon termination of employment (e.g., retirement) or death or disability before retirement. These agreements are often geared toward anticipated retirement in order to provide cash payments to the retiree and to defer taxation to a year when the recipient is in a lower bracket. Although the employer's contractual obligation to pay the deferred compensation is typically unsecured, the obligation still constitutes a contractual promise.
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The CalPERS 457 Plan is a voluntary deferred retirement savings plan that allows you to defer any amount, subject to annual limits, from your paycheck. This article highlights several of the main considerations for employers when they are operating, amending or terminating a NQDC plan.A 457(b) plan is a tax-deferred retirement savings plan. Funds are withdrawn from an employee's income without being taxed and are only taxed upon withdrawal. Before implementing a nonqualified deferred compensation plan, employers should consider the benefits and tax and compliance consequences. Learn about common tax and Form 990 reporting issues associated with nonqualified deferred compensation arrangements. The following table identifies special types of payments and whether the type of payment is subject to California payroll taxes. Independent contractors, such as nonemployee members of the board of directors, pay Self Employment Contributions Act. The Plan allows Eligible Directors to defer the receipt of Director Fees and to receive settlement of the right to receive payment of such amounts.