Rabbi Trust Benefits

• Category: Trusts - Rabbi
• State: Multi-State
• Control #: US-01178BG
• Format: Word; Rich Text

Description

The Nonqualified Deferred Compensation Trust for the Benefit of Executive Employees, commonly known as a Rabbi Trust, provides significant benefits for companies looking to secure deferred compensation for a select group of management or highly compensated employees. The trust helps protect the assets designated for employee benefits from company creditors in the event of insolvency, ensuring that participants receive their entitled compensation. Companies can make contributions to the trust, which is revocable and treated as an unfunded arrangement under the Employee Retirement Income Security Act. This trust allows for flexibility in payments, where the schedule and amounts are determined by the company and managed by the trustee. Key features include the trustee's authority over investments, clear guidelines on payments to participants and their beneficiaries, and well-defined responsibilities and liabilities for the trustee. For attorneys, owners, and paralegals, the Rabbi Trust is an essential tool for managing employee benefits, ensuring compliance with applicable laws, and safeguarding client interests. Legal assistants can also benefit from understanding the filling and editing instructions to facilitate efficient implementation of the trust agreement within their firms.