Executive Bonus Plans
This is a great way for business owners or companies to provide additional supplemental benefits to key employees or executives of their choice. You can include everyone, a select group or just the owner(s)… it’s completely up to the decisionmakers who gets a bonus plan and how much they want to bonus into the plan each year (the bonus amounts put into the plan can be changed from year to year also depending on cash flow, contribution of the employee to the organization, etc.).
Executive bonus plans can be structured as an individual or group corporate carve-out benefit and the inherent flexibility of the plan, like being able to vary how much the company bonuses into the plan annually per individual, makes it especially attractive to small and medium size companies. The benefits usually include annual cash bonus contributions to the plan by the employer for the benefit of the employee or key leaders. There is typically a vesting schedule before which the employee does not have access to the funds within the account. With an executive bonus plan, the business can use tax-deductible company funds to selectively provide valued benefits to key people at whatever amount they choose. An executive benefit plan, used effectively, can be a valuable tool to attract and retain key executives and employees.