Large Law Firm
One of Los Angeles’ largest law firms needed to provide a program for additional tax-deferral for the dozens of partners. The 401(k) Profit Sharing contributions maxed out around $50,000 and were just not enough.
Kravitz designed a Cash Balance plan that will allow the firm to contribute approximately $9,500,000 into the plan, with many of the partners receiving their age-weighted maximum every year. The firm is also delighted to continue to offer excellent benefits for employees.
Retirement Plan Illustration
Year Ending December 31, 2018
Partners 50 or above | 401(k) | Profit Sharing | Cash Balance | Total |
| 1 | $24,500 | $36,500 | $217,000 | $278,000 |
| 2 | $24,500 | $36,500 | $166,000 | $227,000 |
| : | : | : | : | : |
| 43 | $24,500 | $36,500 | $127,000 | $188,000 |
| Subtotal | $1,053,500 | $1,569,500 | $5,844,000 | $8,467,000 |
Partners under 50 | 401(k) | Profit Sharing | Cash Balance | Total |
| 1 | $18,500 | $36,500 | $120,000 | $175,000 |
| 2 | $18,500 | $36,500 | $97,000 | $152,000 |
| : | : | : | : | : |
| 47 | $18,500 | $36,500 | $74,000 | $129,000 |
| Subtotal | $869,500 | $1,715,500 | $3,695,000 | $6,280,000 |
Partners Total | $1,923,000 | $3,285,000 | $9,539,000 | $14,747,000 |
| 143 Associates | n/a* | $0 | $0 | $0 |
| 247 Other Employees | n/a* | $926,250 | $0 | $926,250 |
| Total | $1,923,000 | $4,211,250 | $9,539,000 | $15,673,250 |
Percent to Partners: 94%
*This illustration shows only the cost to the firm.
Staff employees and associate attorneys pay for their own 401(k) contributions.