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How Bankruptcy Affects Your Nonqualified Deferred Compensation

One of the biggest risks you face with nonqualified deferred compensation is the possibility of your company’s bankruptcy. Unlike 401(k) plans, NQDC plans do not receive ERISA protections, and the funds in the plans are at risk of being included in a company’s bankruptcy estate. This article addresses key issues that NQDC participants should know about corporate bankruptcy.

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