Executive bonus plans
Retain top talent and reward key executives with tax-efficient compensation strategies
What an executive bonus plan does
An executive bonus plan ties life insurance to compensation, letting your company fund a death benefit while the executive receives a tax-deductible bonus. It's straightforward, flexible, and built for retention.
Three reasons to consider this
Executives stay when they know you value them
Attract and retain top talent
Your bonus is deductible. The death benefit is tax-free. The math works.
Tax-advantaged compensation
Adjust amounts, add participants, or change structure as your business grows.
Flexible plan design
Works for startups, mid-market firms, and established companies alike.
Building an executive bonus plan happens in stages. We handle the design, your company funds the insurance, and the executive receives the benefit.
Design the plan
We determine who participates, bonus amounts, and death benefit levels based on your goals.
Fund the insurance
Your company pays the premium each year and deducts it as a business expense.
Executive receives bonus
The executive gets a taxable bonus to cover their tax obligation on the death benefit.
Death benefit protection
If the executive passes, your company receives the tax-free death benefit as planned.
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Questions
Everything you need to know about executive bonus plan design
Any key employee or executive your company wants to retain can participate. There's no limit on who you choose to include, and you control the bonus amounts and timing each year.
The bonus is a deductible business expense for your company. The executive pays ordinary income tax on the bonus, but the life insurance death benefit passes tax-free to your business or designated beneficiary.
Yes. Executive bonus plans are flexible by design. You can adjust bonus amounts, add or remove participants, or modify the structure as your business evolves.
The policy stays with your company. You own the death benefit and cash value. If the executive departs, you retain the insurance protection and accumulated value.
Costs depend on the executive's age, health, and the death benefit amount. We run illustrations showing the true cost after tax deductions so you see the real impact on your bottom line.
That's the primary purpose. The promise of a bonus tied to life insurance creates a powerful incentive for key people to stay. It's retention and protection in one strategy.
Need more clarity?
Our advisors can walk through your specific situation
Design your retention strategy
Let's build an executive bonus plan that works for your business