Greenbook Financial Services: The Blueprint for Your Retirement

The Blueprint for Your Retirement

Greenbook Pension Services specialists craft your customized retirement plan to take full advantage of the tax law changes enacted in 2001 under The Economic Growth and Tax Relief and Reconciliation Act, commonly known as EGTRRA, the 2003 Jobs and Growth Tax Relief and Reconciliation Act, and the Pension Protection Act of 2006.

These recent tax law changes can dramatically increase doctors’ retirement savings opportunities and remove restrictions that previously reduced such accumulations contained within other qualified retirement plans. In our opinion, this important regulatory and policy shift has resulted in an unprecedented opportunity for doctors to boost pre-tax deductions to a qualified retirement plan — and Greenbook is poised to assist you in this regard.

How? Greenbook has the expertise to show qualifying doctors how to contribute up to $200,000 or more per year of tax-deductible net practice earnings to IRS-approved retirement plans. This translates into the ability to contribute tax-deductible dollars to build more than $2 million in pension plan assets.

Powerful Intellectual Property — The Greenbook Pension Feasibility Study

Greenbook pension specialists ensure that client plans offer results that adhere to the rules of the Internal Revenue Code. What’s more, Greenbook’s proprietary Pension Feasibility Study (PFS) technology produces a differential diagnosis, analyzing the various qualified planning options and identifying the most efficient retirement plan specific to individual practice needs.

The Pension Feasibility Study application was built using state of the art tools, thousands of pages of financial regulations, more than one year’s worth of development hours and valued input from some of the industry’s leading actuaries. PFS uses an enterprise-level server farm and may iterate through 65 million calculations in order to complete one client study. The report can then be viewed and modified for various “what if” scenarios to quickly and easily display the advantages of several pension plan possibilities. In addition, our experienced staff can apply a “human touch” to optimize the plan for complex cases.

Pre-Retirement Protection

Shielding your unspent qualified plan accumulations from unnecessary loss caused by unexpected events, including pre-retirement death, is an important consideration. The Internal Revenue Service has provided rules that define the maximum protection against mortality loss that can be legally acquired by your qualified retirement plan. Qualified plan funds, allocated to fixed premium life insurance contracts that are specially designed for this purpose, can be purchased under these rules.

There is a minimal cost for this benefit since the qualified plan funds allocated for this purpose earn a rate of return specified in the insurance contract. Inclusion of life insurance in your plan will protect your family and your employees’ dependents in the event of pre-retirement death. If the policy goes unused, the cash accumulations in the insurance contract within the qualified plan become available for retirement spending.

Your Qualified Plan Options

Defined Contribution (DC) Plans

Defined contribution plans provide an individual account for each participant. The individual accounts can be managed separately for each employee, or managed in a single account with each participant’s percentage tracked by Greenbook pensions professionals. Employer contributions, investment gains or losses, plan income or expenses, and forfeitures of accounts of unvested or partially vested terminated participants are allocated to these individual accounts. When a participant retires or terminates employment, the benefit payable to him/her is the vested portion of the account balance. Employee account contribution maximums, including 401(k) deferrals, are $44,000 if under age 50 or $49,000 if over age 50 and using 401(k) catch-up contributions.

Profit Sharing Plans

These plans provide maximum flexibility, as a specified contribution is not required each year and the employer may vary the contribution annually. The maximum contribution is 25% of total eligible compensation of the practice and the maximum allocation to an individual is the lesser of either 100% of plan compensation or $44,000. If it is determined that a 401(k) feature will enhance the plan’s efficiency, the plan can be designed to allow employees, including the doctor and doctor’s spouse (if employed by the practice) to make 401(k) deferrals, which may allow additional savings up to $15,000 if under age 50 or $20,000 if over age 50.

Safe Harbor — allocates employer contributions uniformly to all eligible participants as a percentage of their plan compensation
Integrated — maximizes proportion of employer contributions to higher paid employees via integration with Social Security
Cross-Tested, New Comparability or Tiered Allocation — allow different levels of contributions to be allocated to different groups of employees (e.g., by job title, salary, etc.), with each participant’s contribution converted to a benefit paid at retirement

Defined Benefit (DB) Plans

Defined benefit plans provide a monthly benefit beginning at retirement and payable until death. The amount is based on years of service and earnings during the highest three consecutive years of employment while participating in the plan, with a maximum annual benefit of $175,000 beginning in 2006.

These plans provide employers with the potential for much greater savings opportunities than defined contribution plans. Defined benefit plan sponsors can maximize contributions by providing an insured death benefit under IRS incidental benefit limits. These specially designed life insurance contracts protect participants from premature death, with the cash value of the policies funding retirement benefits.

An employer can maintain both a defined benefit plan and a profit sharing plan at the same time and maximize contributions as long as no employees are included in both plans. In addition, an employer can allow participants in a defined benefit plan to make elective deferrals into a 401(k) account maintained within a profit sharing plan.