Do The Policies Actually Fund The Benefits Like a Pension Plan Funds Retirement Benefits?
No. The annual non-interest income non-taxable from the policies is used to offset annual employee benefit costs like health insurance, FICA, etc. Also, if a bank has a non-qualified defined benefit plan for its executives, or wishes to implement one, it must accrue the liability annually over the service life of the individuals. The annual income from the BOLI is also used to offset those costs.
Related Questions
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- Do The Policies Actually Fund The Benefits Like a Pension Plan Funds Retirement Benefits?
