Another non-qualified deferred comp retirement plan for executives who are PSG 28 or above (used to be PSG 27 or above) is Deferred Compensation Plan (DCP). This plan allows the executives to defer part of their compensation during the years of employment. The amount accrued can be distributed after separation from service as lump sum or in annual payments over up to ten years.
The planned distribution should be considered and aligned for retirement income needs. We often find situations where income is unnecessarily high and should be coordinated with outside income source timing.
As part of our service, we work closely with our clients to create a plan for contributing to their DCP. By deferring part of their compensation now, they may be able to take a tax benefit in the years of employment, and create an income source for them in retirement with potentially lower tax consequences.
Read more about how we can help you understand your Chevron Employee Benefits.
DCP benefits are taxable as ordinary income when payments are made. At that time federal, state and local taxes will be withheld. However, you will not owe any Social Security or Medicare taxes when payments are made.
To learn more about what Insight Wealth Strategies can do for you or your colleagues in San Ramon, CA or Houston, TX, please call us at (800) 318-7848, email us at [email protected] or fill out the request information form
