What To Know About Deferred Compensation
If you are dividing retirement assets in a divorce, you will hear a lot about deferred compensation. Our divorce law attorneys can explain your options when it comes to your assets and more. At Nelson Kirkman, we have served Newport Beach and the Orange County area since 1998. We are prepared to answer any and all questions you have for us.
How many types of deferred compensation plans exist?
There is a wide variety of deferred compensation plans, some of which are completely customized to an employee’s situation. Some plans follow the Employee Retirement Income Security Act (ERISA) rules and regulations, but others are completely free of such rules. Deferred compensation plans are typically complex and hard to value and include benefits that may be received far in the future, if at all. A deferred compensation plan earned in part during a marriage typically will be characterized by the court as community property in California divorce proceedings.
What makes a deferred compensation plan qualified as opposed to nonqualified?
A qualified deferred compensation plan must be offered to all employees and must follow all rules and regulations found in the Employee Retirement Income Security Act (ERISA). A popular example of a qualified deferred compensation plan is a 401(k)-plan offered by many employers. A nonqualified plan doesn’t need to follow ERISA or be offered to all employees, and generally contains an element of risk.
What are common examples of deferred compensation plans?
There are many types of deferred compensation plans. Below is a short list of common plans used by employers today:
- Restricted stock
- Stock appreciation rights (SAR)
- Supplemental executive retirement plans (SERP)
- Bonus deferral plans
- Nonqualified stock options
- Phantom stock plans
- Profit units
Ask Us About Deferred Compensation And Your Divorce Today
We understand that the financial details of a divorce can seem overwhelming. You can come to Nelson Kirkman for the comprehensive assistance you need. Call us at 949-430-6952 or send us an email to schedule an initial consultation with a divorce lawyer.