The Restricted Property Trust, (RPT), is different.
• Unlike your qualified plan, 100% of your contribution goes to YOU and is not shared by employees.
• Assets held by the trust are positioned in one of the most stalwart investment vehicles of the past 50 plus years.
• Your medical group receives a 100% tax deduction for your contribution, and only 30% of the contribution is currently taxed to you.
• The trust provides a death benefit that can be used for estate planning or buy-sell agreements.
• You choose your contribution amount based on your own planning needs, and not based on other participants.
• The assets held by the trust are protected from creditors.
• The RPT is only available to the owners/doctors or key employees.
Does this sound too good to be true? Let me help clear that up for you. First, once you choose your annual contribution amount it cannot be changed. Second, you must commit to a period of no less than five years, and any plan extensions must be no less than five years. Therefore, the plan is only available in five-year increments, i.e. 5, 10, or 15 years. If you stop working for your current company, or can no longer afford the contribution, your entire account will be forfeited. Third, the assets and the death benefit can never revert back to the corporation funding the trust. Fourth, the cash is not accessible in any manner (loans or withdrawals) while participating.
The RPT is not a fit for everyone. Individuals seeking the advantages of this strategy must have a five-year horizon and strong, consistent cash flow. However, if the RPT fits your business, it can play an integral role in helping you achieve your personal financial goals.
If you would like more information on how an RPT would work for you, please contact Joseph Resnick at JR Katz, 847-564-8430, joseph@jrkatz.com.
