Presented by Bill Zimmer, Co-founder of Ecusta Brewing & Founder of Craft Financial, LLC
The Concept
A brewer/distiller bonus arrangement is an employee benefit in which the employer agrees to fund a separate bonus structure on selected employee or employees. The company has ownership over the structure and retains a collateral assignment on any assets.
The Purpose
The employer creates additional rewards for specific individuals such as head brewer/distiller, production manager or other key employees.
The Process
- The employer usually spells out the terms of the arrangement in a written agreement..
- The annual payment or cash bonus is deductible by the employer, provided the insured employee’s total compensation is “reasonable” in the IRS’s opinion.
- The values belong to the employee, who can use them for emergencies or to supplement income after retirement. If the employee does not reach the written agreement, the values belong to the employer.
The Bottom Line
Brewer/Distiller bonus arrangements can provide a tax-favored way to reward valued employees on a selective basis. These employees enjoy the benefit of protection and the potential for increased retirement income.
(This is a recording of a previous live event.)
