NU Online News Service, Aug. 27, 11:35 a.m. – The Principal Financial Group Inc., Des Moines, Iowa, has introduced the Principal Executive Bonus Plus savings program.
The program does not qualify for the federal tax breaks given to ordinary, broad-based retirement savings plans, but it gives employers a special savings vehicle they can offer to their most valuable employees.
Participating employees can use the program to put after-tax income in life insurance policies, mutual funds or annuities.
Employers can pay some or all of the employees’ taxes on the contributions, and the employers’ own contributions are tax-deductible, Principal says.
The employee owns and controls the benefit. In most cases, the employee can choose how much to contribute and which investment options to use, Principal says.