This practice group has established an extraordinary reputation based on four complementary characteristics: technical excellence and creativity, responsiveness to clients, cost effectiveness and involvement in the Federal legislative and regulatory arena. As a result, Paley Rothman is nationally regarded as an industry leader in the retirement plans and employee benefits fields.Individualized plan design has become all the more important as the law has become increasingly complex; our attorneys create customized retirement plans to suit each client’s needs. We take pride in staying on top of the law and do not rely on “canned plans” or outside consultants to perform these services.
We have prepared hundreds of individually-designed plans, many of which are structured to maximize contributions for some or all of the company’s key employees. Many of our clients have established “group-based” plans so that different groups of employees receive different contribution amounts. Every effort is made to draft flexibility into plans, allowing our clients to select from a wide range of investments. We draft sophisticated defined benefit plans that satisfy insurance needs and/or estate planning goals, particularly for closely held or family-owned companies. While working closely with our clients, we discuss and determine the type of plan that best meets the needs of the company and its most valuable employees.
Members of this practice group prepare beneficiary designations for our clients’ retirement plans and IRAs that maximize tax-deferred growth. We draft IRA beneficiary designations that allow plan assets to stay in IRAs so that benefits are paid out over several generations, thus deferring for as long as possible taxation of the distributions. By keeping retirement plan money growing in a tax-free vehicle for the longest time allowed by law, these retirement plans often become our clients’ most valuable assets.
We provide full service to our clients over the life of their retirement plans–from design and establishment, through amendments, mergers and successor plans, and eventually termination and rollover of the benefits to IRAs.
Our attorneys lecture frequently to national, regional and local associations as well as to continuing legal education groups including the American Bar Association, ALI-ABA, MICPEL, IRS Employee Benefits Conference, the American Society of Pension Actuaries, the Practicing Law Institute and the U.S. Chamber of Commerce. These programs augment our technical knowledge and keep our attorneys on the cutting edge of this fast-moving field. For the past four years, our attorneys have written chapters for the prestigious New York University Institute on Federal Taxation-Employee Benefits and Executive Compensation.
This practice group is very much in the loop on the latest committee and legislative actions pending in Congress; some of its members are often asked to testify before Congress on proposed retirement plan legislation. In 2002, one of the firm’s partners led a national campaign that helped change federal pension law for the benefit of our clients. Since retirement plan legislation is known to be implemented quickly, it behooves us to monitor Congress in order to be in position to act in timely fashion on behalf of our clients.
The following descriptions are illustrative of our retirement plans practice, but are by no means inclusive of all the services we provide our business, trade association and nonprofit clients.
Qualified Retirement Plans
We design, establish and provide ongoing legal advice on qualified retirement plans for companies of all sizes, taking pride in our ability to meet our clients’ goals without unnecessary complexity. We have experience with all types of qualified retirement plan design, including the sophisticated cross-tested plans, defined benefit plans and cash balance plans. Our attorneys have written hundreds of 401(k) plans, including “safe harbor” 401(k) individually tailored plans to meet our clients’ needs, and have also prepared defined benefit and cash balance plans when appropriate. We help nonprofit and trade association clients design their plans so that employees appreciate such a valuable benefit and prepare the documents necessary to keep plans in compliance with IRS and DOL regulations. Clients call us on an ongoing basis to ensure that their plans are being executed in accordance with the law
Non-Qualified Deferred Compensation Plans
The lawyers in this practice group also help many organizations, including nonprofit groups, design and implement various types of non-qualified deferred compensation plans for key employees, including 457(b) Plans, 457(f) Plans, Rabbi Trusts, Stock Appreciation Rights Plans, Secular Trusts, Top-hat Plans, Incentive Stock Option Plans, Non-qualified Stock Option Plans and Phantom Stock Plans. As part of our overall planning in the executive compensation area, we analyze and help implement many of the recent innovative insurance products that mutually benefit key employees and our institutional clients.
Our retirement plans work is as diverse as it is distinguished. We have developed too many to list, but here are a few that bear mention:
- A group-based profit-sharing plan for a law firm with more than 80 lawyers designed to provide certain key attorneys and long-term staff employees with larger retirement benefits than others;
- A safe harbor 401(k) plan and money-purchase pension plan for a major automotive trade association. The safe harbor feature allows highly paid employees to make the maximum 401(k) contribution allowed by law, without having to pass discrimination testing;
- A defined benefit plan designed to provide a significant stream of income during retirement for “Mom and Pop” and a large insured death benefit for the children. This plan generated unique income and estate tax planning opportunities for this successful second generation family business;
- Individually designed plans for leading professionals – doctors, lawyers, dentists, accountants, engineers and consultants. Many of these professionals have worked with us for more than two decades, and many have accumulated significant assets in their retirement plans;
- Beneficiary designations for retirement plan and IRA benefits. These designations are consistent with our clients’ estate plans and often provide benefits to be used by their children and grandchildren, even while these assets remain in the IRA.
- A 401(k) profit-sharing plan and defined benefit plan for a major local manufacturing company. The 401(k) plan provides desired benefits for the younger, more transient employees, while the defined benefit plan rewards the older, long-term employees by providing them with a stream of retirement income that they cannot outlive.
Retirement Plans E-Alerts
E-Alert March, 2004 – Retirement Plan Limitations for 2004
E-Alert June, 2004 - Charging Terminated Employees with Administrative Expenses
E-Alert October, 2004 – Retirement Plan Limitations for 2005
E-Alert November, 2004 – Written Statement of Investment Policy
Paula A. Calimafde
Arnold B. Sherman
Robert H. Maclay
Jessica B. Summers