Skip to content
+1.813.367.1111
    Login page Login
    Contact

      Deferred Compensation Plan (DCP) Overview - A 401(k) Supplement

      Deferred Compensation Plan (DCP) Overview - A 401(k) Supplement
      Picture of Mezrah Consulting
      1
      min. read

      A nonqualified deferred compensation plan (DCP) is an executive benefit plan that allows executives to defer, before tax, an unrestricted amount of compensation (salary, bonus and certain forms of equity) and to elect to receive that compensation plus any earnings as a distribution at a future time.

      Unlike 401(k) plans, nonqualified deferred compensations plans are not subject to discrimination testing. From the company’s perspective, these compensation deferrals are viewed as a future promise to pay and are typically structured with an offsetting asset to ensure minimal or no P&L impact to the company. These assets are often held in trust and can grow on a tax favored basis.

      Mezrah Consulting provides consulting services in designing, implementing and funding new DCPs, as well as ongoing administration for plans through our cloud-based mapbenefits® platform. We also audit existing plans to assess the competitiveness, appropriateness of their design, administration and financing with the goal of minimizing plan costs for the company and maximizing benezfits for executive participants.

      Typically, a 17% annual deferral is required to meet a targeted 80% income replacement at retirement. Highly compensated employees are unable to meet this goal without a DCP due to 401(k) contribution limitations.
       
      4e9833_7903e0d807d4409abd6c252116cd1431~mv2
      4e9833_6655210665a6409d9636228f0f0ff0d6~mv2
       
      More Information

      For more information call (813) 367-1111 and ask for Sales, or email consulting@mezrahconsulting.com. A team member will reach out to you shortly! 

      Who We Are
      Mezrah Consulting, based in Tampa, Florida, is a national executive benefits and compensation consulting firm specializing in plans for sizable publicly traded and privately held companies. For more than 30 years, we have focused on the design, funding, implementation, securitization and administration of nonqualified executive benefit programs, and have advised more than 300 companies throughout the U.S.
       

      As a knowledge-based and strategy-driven company, we offer clients highly creative and innovative solutions by uncovering value and recognizing risks that other firms typically do not see. Custom nonqualified benefit plans are administered through our affiliate mapbenefits®, a proprietary cloud-based plan technology platform that provides enterprise plan administration for nonqualified plans, including reporting and functionality for plan participants and plan sponsors.

      Securities offered through Lion Street Financial, LLC. (LSF), member FINRA & SIPC. Investment Advisory Services offered through Lion Street Advisors, LLC (LSA). LSF is not affiliated with Mezrah Consulting. LSF, LSA and Mezrah Consulting do not offer legal or tax advice. Please consult with the appropriate professional regarding your individual circumstances.