Cash Balance Plans: An Overview

November 1, 2023
Take advantage of accelerated retirement savings and significant tax benefits by offering Cash Balance Plans.

A Cash Balance arrangement is an IRS tax qualified “hybrid” retirement plan. It combines the high contribution limits of a Defined Benefit Plan and the simplified contribution formula and portability of a Defined Contribution Plan. It is typically paired with a 401(k) Profit Sharing Plan to maximize retirement savings and tax-deductible contributions.

Who Cash Balance Plans May Benefit

  • Business owners and self-employed individuals who want to contribute significantly more than permitted in a 401(k) Profit Sharing Plan
  • Professional practices and partnerships interested in maximizing tax deductions
  • Profitable companies seeking to provide select employees with greater benefits

 

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