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"CREATIVE COMPENSATION TECHNIQUES FOR FAMILY BUSINESSES" [2019] ELECD 1425; in Zwick, A. Gary; Jurinski, J. James (eds), "Tax and Financial Planning for the Closely Held Family Business" (Edward Elgar Publishing, 2019) 117

Book Title: Tax and Financial Planning for the Closely Held Family Business

Editor(s): Zwick, A. Gary; Jurinski, J. James

Publisher: Edward Elgar Publishing

Section: Chapter 5

Section Title: CREATIVE COMPENSATION TECHNIQUES FOR FAMILY BUSINESSES

Number of pages: 51

Abstract/Description:

Family businesses are different than other businesses. The primary difference is that family members are on payroll and their compensation often does not reflect the market for similarly situated employees. Not only are the amounts different but because of their relationships to owners and in some cases having ownership themselves, there is a great deal more flex available to family members working in the business to structure compensation for the greatest tax benefit. This chapter goes through compensation strategies such as ways to reduce payroll taxes, deferrals, using stock options and restricted stock, non-qualified deferred compensation and when to use it and using some anomalies in the law to the advantage of the family and the family member.