If you are a successful business owner and you want to grow your assets and reduce your income taxes, you should consider getting a Restricted Property Trust. There are a lot of employer-sponsored plans that you can choose from. Nonetheless, only a Restricted Property Trust is the most appealing with its ability to access tax-advantaged distributions, make before-tax contributions, and defer taxes on growth. See more here for some basic facts and information about Restricted Property Trust.
One of the things that you need to know about the Restricted Property Trust is that it is not made for everyone. For starters, the initial funding for your Restricted Property Trust has a minimum commitment requirement of $50,000 every year for the following five years. Not meeting the annual contribution will forfeit the assets of your Restricted Property Trust to the charity that you have predetermined to be your choice. The Restricted Property Trust might not be the right choice for you when this requirement is not met.
A Restricted Property Trust is basically plan sponsored by the employers given to owners of a business. It can be established by a partnership, LLC, C corporation, or an S corporation. This cannot be established if you only have sole proprietorship.
The primary goal of a Restricted Property Trust is to provide business owners with non-taxable income, long-term accumulation, and tax-favored contributions. You get more than 8% when you choose a Restricted Property Trust than other investment options.
A Restricted Property Trust is basically not a qualified plan. This implies that if you make contributions to your Restricted Property Trust, they will not affect the contributions that you have made with other qualified plans. Some examples of qualified plans include defined benefit plan, profit sharing plan, and more.
In comparison to other qualified plans, the use of Restricted Property Trust can be done to benefit the business owner alone. Every participant has the right to select their chosen level of contribution in spite of the number of contributions that other participants are making.
The annual contributions made to a Restricted Property Trust is deductible fully to the employer. When it comes to the taxable income of the participant, a small percentage of their contribution goes to it. Once an annual contribution is made, the trust then avails a cash value life insurance plan that is conservative. The growth of the cash value of this life insurance plan is tax-deferred. Your life insurance policy will lapse when you fail to meet your annual contributions. In addition, the policy cash values will be forfeited to a pre-selected charity.