A:
Jason Sanborn is a senior-level executive with Beanster Brew, one of the world's largest coffee bean importers. To sweeten his contract, Beanster offered Mr. Sanborn a retirement plan that pays 57% of his salary per year for the rest of his life, beginning at age 65. Which of the following situation does this arrangement describe:
a) A non-qualified plan
b) A contribution limit
c) A qualified retirement plan
d) a profit sharing plan
e) An ERISA infraction
The correct answer is a)
This is an example of a non-qualified retirement plan; it is also evidence of a defined benefit plan.
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