A Tax Strategy for High-Income Clients
OnePersonPlus Defined Benefit Overview
®
Powerful Retirement Plan with Huge Tax Savings
Typical Occupations
OnePersonPlus Defined Benefit (DB) Plans allow higher deductible retirement
contributions annually than other qualified plans. This program is designed for small
businesses with one to five employees. Depending on the situation, business owners
may be able to save over $2 million** for retirement in just 10 years to fund plan benefits.*
The plan’s open architecture allows assets to be invested in mutual funds, bonds,
equities, annuities, or any other marketable securities that you and your clients select.
Attorney
Construction Trades
Consultant
Dentist
Engineer
Entertainer
Farmer
Financial Advisor
Graphic Designer
Independent Corporate Director
Physician
Real Estate Agent
Sales Rep
Software Developer
Writer
®
Benefits for Financial Advisors
• T
ypically results in a large, steady stream of contributions to invest each year
of the plan
• Open architecture to purchase equities, mutual funds, fixed income, or other
marketable securities
• Streamlined plan set-up and administration
• Plans promote long-term relationships
• Online tool calculates personalized retirement plan comparison for clients
• Sales ideas and support at onepersonplus.com/transamerica
• Turn-key administration by defined benefit specialists who prepare proposals
and handle the plan’s set-up, ongoing government reporting, and
actuarial calculations
Key Prospects
• Independent professionals, small business owners, and individuals with
self-employment income
• 40+ years of age
• Wish to contribute more than $50,000 annually
Client Benefits
•
•
•
•
•
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Highest allowable contributions to a qualified plan—$100,000 or more potentially
Annual tax savings of $40,000 or more*
Investments grow tax-deferred to fund plan benefits
Potentially increases income in retirement
Tax-free rollover to an IRA (at retirement or at plan termination)
Low yearly fee and one-time set-up charge
Visit onepersonplus.com/transamerica or call our Dedicated Defined Benefit
Services sales consultants at 866-765-6321 for training, marketing materials,
prospecting ideas, and help closing the sale.
*Results will vary based on age, income, and many other factors.
**See examples on back.
This material is provided for general and educational purposes only and is not intended to provided legal,
investment, or tax advice or to avoid penalties that might be imposed under U.S. federal tax law. Clients should
contact their own tax or legal advisors to learn more about rules that might affect their individual situation.
Transamerica is not affiliated with Dedicated Defined Benefit Services, LLC.
Basic Fee Schedule
Plan Design and Document
Preparation Fee (one-time)
DB: $1,250 one person
$250 per additional participant
401(k): $200
Annual Administration
DB: $1,950 one person
$150 per additional participant
401(k): $550
$150 per additional participant
Questions
Phone: 866-765-6321
Dedicated Defined Benefit Services
550 North Brand Boulevard, Suite 1610
Glendale, CA 91203
[email protected]
Instant DB Calculator
onepersonplus.com/transamerica
Estimate your clients’ maximum
contributions and savings
Typical Defined Benefit Clients
OWNER-ONLY BUSINESS
EMPLOYEE WITH SIDE INCOME
Objective: Maximum contribution and tax deduction
Objective: Reduce taxes on side income
Profile: Independent consultant age 52, has W-2 income of
Profile: University professor, age 56, also has $150,000 in sole
$300,000, and plans to retire at 62.
Solution: DB Plan for 10 years and a 401(k)
DB only
DB + 401(k)
2015 Contribution: $182,200$222,100
Tax Savings@ 38%: $69,200$84,300
proprietor income for the past several years from consulting,
board fees and speeches (after paying self-employment taxes)
and plans to retire at 62.
Solution: DB Plan for 6 years for side income
2015 Contribution: $120,000
Tax Savings@ 38%: $45,600
Projected DB Accumulation: $2.54 Million
Projected DB Accumulation: $856,400
Annual DB Benefit: $210,000
Annual DB Benefit: $70,600
OWNER-ONLY INCOME FLUCTUATES
SPOUSE HAS SELF-EMPLOYMENT INCOME
Objective: Reduce taxes, retain flexibility
Objective: Invest earned income for retirement
Profile: Engineer, age 48, W-2 income of $185,000 this year, not
Profile: Wife, age 60, has been earning $100,000 in bookkeeping
sure it will always be this high.
Solution: DB Plan for 14 years, optional 401(k)
DB only
DB + 401(k)
2015 Contribution: $136,600$165,700
Tax Savings@ 38%: $51,900$62,900
Projected DB Accumulation: $2.24 Million
MARRIED BUSINESS PARTNERS, NO EMPLOYEES
Objective: Maximize retirement savings
Profile: Husband and wife doctors, Adam age 60, Eva age 58,
W-2 income for each is $265,000, both plan to retire in 5 years.
Solution: DB Plan with 5 years funding, optional 401(k)
DB + 401(k)
2015 Contribution: $426,000$505,800
Tax Savings@ 38%: $161,800$192,200
Projected DB Accumulation: $2.43 Million
Annual DB Benefit: $210,000
Solution: DB Plan for 5 years
2015 Contribution: $80,000
Tax Savings@ 38%: $30,400
Projected DB Accumulation: $457,000
Annual DB Benefit: $185,000
DB only
practice (after self-employment taxes) for the past several years.
They don’t need the money now and want to invest it.
Annual DB Benefit: $40,400
SMALL BUSINESS WITH HIGH EARNING OWNER,
1 – 4 YOUNGER LOWER PAID EMPLOYEES
Objective: Reach retirements savings goal faster,
and provide employee benefit
Profile: Dentist, age 55, plans to retire at 62, W-2 income of
$400,000; 3 employees, age 28-40, earn $35,000-$50,000.
Solution: DB Plan for 7 years for dentist and employees
2015 Contribution: $205,700$36,000
Tax Savings@ 38%: $78,100
Projected DB Accumulation: $1.78 Million
Annual DB Benefit: $147,000
Transamerica and the Transamerica pyramid logo are registered service marks of Transamerica Corporation.
Examples assume 5 – 7% rate of return and are provided for illustrative purposes only and do not represent the results of a
real investment. Note that actual contribution amounts are calculated based on interest rates as provided in IRS Code Section
430(h)(2)(c) and will vary. Also note that the projected DB accumulation funds the benefits payable under the plan. The projected
DB accumulation value is calculated based on Mortality Table 1994 GA 2002 unisex and could be different from the value of
the benefits paid under the plan. Dedicated DB will be responsible for determining the appropriate annual contributions and for
monitoring the plan’s funding levels.
Transamerica Capital, Inc. (TCI) is the distributing and wholesaling broker-dealer for Transamerica Funds, Transamerica Life
Insurance Company, and Transamerica Financial Life Insurance Company.
© 2015 Dedicated Defined Benefit Services LLC. All rights reserved.
OnePersonPlus® is a registered trademark of Dedicated Defined Benefit Services LLC.
OPPDB0415