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, 2017

Partners 50 or above
401(k) Profit Sharing Cash Balance Total
1 $24,000 $36,000 $217,000 $277,000
2 $24,000 $36,000 $166,000 $226,000
: : : : :
43 $24,000 $36,000 $127,000 $187,000
Subtotal $1,032,000 $1,548,000 $5,844,000 $8,424,000
Partners under 50
401(k) Profit Sharing Cash Balance Total
1 $18,000 $36,000 $120,000 $174,000
2 $18,000 $36,000 $97,000 $151,000
: : : : :
47 $18,000 $36,000 $74,000 $128,000
Subtotal $846,000 $1,692,000 $3,695,000 $6,233,000
Partners Total
$1,878,000 $3,240,000 $9,539,000 $14,657,000
143 Associates n/a* $0 $0 $0
247 Other Employees n/a* $926,250 $0 $926,250
Total $1,878,000 $4,166,250 $9,539,000 $15,583,250
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.