Deferred
Compensation is an opportunity to voluntarily shelter a portion of your
wages from income taxes while saving for retirement to supplement your
social security and pension benefits. Under the Plan, income tax is not
due on deferred amounts or accumulated earnings until you receive a
distribution (payment) from your account. Presumably, distribution is at
retirement when your tax rate is expected to be lower.
OR
Deferred compensation is income to be paid at a later date, usually the
end of employment.
OR
Compensation earned by an individual, the receipt of which is postponed
until a later date, usually upon termination of employment or
retirement. Typically, the deferred amounts are invested on the
recipient's behalf and may be supplemented by contributions by the
company. If the compensation arrangement meets certain requirements, an
individual may not pay income taxes on the compensation until he or she
receives a distribution of some or all of the deferred amounts.
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