MSO Deferral Plan™
Solution for C Corp and S Corp majority shareholders to defer income.
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An innovative solution for a traditional challenge.
Majority owned S Corporations and C Corporations can establish an MSO (Majority Shareholder Owned) deferral plan to better manage corporate operations and provide the business owner with the ability to defer income and accumulate wealth on a tax-favored basis.
How It Works:
1 Fee amounts must be determined by a third party in accordance with the rules and regulations governing MSOs.
2 S Corp tax rate may be higher after accounting for state-specific tax rates.
PTE vs. MSO C Corp - Cumulative After-Tax Benefit
The graphic below illustrates the economic advantage of the MSO Deferral Plan over a PTE investing after-tax income into taxable securities. Assumes a 40.8% PTE tax rate, 21% MSO C Corp tax rate, compensation deferral of $2 million annually for 7 years, 7% gross rate of return and a 15-year accumulation period.
