AALU Washington Report on Death Only Benefit Plans

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(March 10, 2015) Ponte Vedra Beach, Florida

A new AALU Washington Report features an in-depth exploration of what Death Benefit Only plans are, which employees may be best served by this type of benefit, and how these plans are implemented. Special attention is paid to the taxation concerns for both employer and employee; these plans are typically subject to less complex tax rules and ERISA regulations than other nonqualified deferred compensation plans that provide lifetime benefits to the employee.

 What is a DBO? From the report:

A DBO plan provides specified death benefits to an employee’s surviving beneficiaries (likely the surviving spouse or children), if the employee was employed by the sponsoring business at death.  These plans generally do not require employee contributions and are not constrained by participation limits applicable to other types of nonqualified deferred plans.  However, DBO plans cannot provide disability, severance, retirement or any other lifetime employee benefits commonly associated with other nonqualified deferred compensation plans.

 You can read the full report below or download it as a PDF from our Resource center.

Fulcrum Partners LLC: AALU Death Benefits Washington Report by Fulcrum Partners LLC

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