An Alternative Retirement Option for Wealthy Small Business Owners: IRC § 412(e)(3) Plans
Internal Revenue Code Section 412(e)(3) Plans (formerly known as 412(i) Plans) can be an appropriate alternative retirement vehicle for certain wealthy small business owners. A 412(e)(3) Plan is a defined benefit plan which is funded with annuities or a combination of annuities and whole life insurance. The primary difference of 412(e)(3) plans and traditional defined benefit plans is that they are capable of creating larger tax-deductible contributions for the plan sponsor, the employer. (more…)