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Your Company’s NQDC Plan: What You Must Understand To Maximize Its Value

Under a nonqualified deferred compensation (NQDC) plan, your company may offer you the opportunity to defer receiving (and paying taxes on) more of your salary and bonus than you can contribute to your 401(k) plan. The NQDC plan itself can have more variety and scope for customization than 401(k) plans do, but you must follow the rules to avoid tax problems. This article looks at what you need to know about the plan itself, and the rules, before you decide to participate.

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