Restricted Property Trust

Protect Your Hard Earned Assets

Restricted Property Trust

What is a Restricted Property Trust (RPT)?

The RPT is an employer-sponsored plan for owners/ and/or key executives. The primary objective is to provide tax-favored long-term cash accumulation and income distribution in a conservative vehicle. An RPT can provide better results than an alternate investment earning 8%.

What are the tax characteristic of an RPT?

Each annual contribution is fully deductible by the employer and only partially taxable to the participant. Asset growth is in the cash value of a life insurance policy and is, therefore tax-deferred. The policy is distributed to the participant at plan termination, at which time a portion of the cash value is taxable.

Who can participate in an RPT? Are there limits on participation?

This plan is available to anyone with earned income, whether from an S-Corp, C. Corp, Partnership business entity. An RPT is not a Qualified Plan, so participant limits and test do not apply, and contributions to an RPT do not impact any Qualified Plan contributions. Each participant in an RPT can select their own level of contribution regardless of what other participant contributes.