What are the tax impacts, Jurden WIndows Inc. hired JUstin,

What are the tax impacts

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Reference no: EM13879399

Jurden WIndows Inc. hired JUstin, a new sales VP, two years ago. Justin is 51. In the words of the company CEO, Justin has "taken the company to the moon." He has used his contacts in the industry to cherry-pick the best salespersons and to put together a sales effort that has everyone talking. That's the good news. The scary news is that everyone wants Justin and his sales team, whose loyalty is more to Justin than to the company. Bottom line: the company needs to lock Justin up.

The CEO of the Co. knows that Justin, a big spender, is concerned about his retirement down the road. The CEO doesn't know much about Justin's financial situation, but suspects that Justin doesn't save and invest much. Justin has inquired on a number of occasions if something can be done to enhance the company's retirement plan, which is a vanilla 401(k) plan that puts the funding onus on the employee.

The CEO would like to adopt a special retirement plan just for Justin. Ideally, it would be a plan that would bind Justin to the Co for the duration. The CEO has many questions: i sushc a plan for one person legal? What are the tax impacts? How would the benefits under the plan be funded? The CEO feels strongly that the plan must offer Justin more than just a "naked promise" down the road. There needs to be "some teeth" to show that the benefits will be paid. Plus, the CEO says it "can't create a bunch of tax problems for Justin before he starts collecting follow his retirement from the company." Advise the company.

Reference no: EM13879399

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What are the tax impacts : Jurden WIndows Inc. hired JUstin, a new sales VP, two years ago. Justin is 51. In the words of the company CEO, Justin has "taken the company to the moon." The CEO would like to adopt a special retirement plan just for Justin. Ideally, it would be a..

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