Cash Balance Plans: Maximize Retirement Savings & Slash Taxes
A powerful retirement and tax strategy for high-income earners and business owners
Cash balance plans are one of the most effective strategies for high-income professionals, dentists, doctors, and business owners who want to supercharge retirement savings while significantly reducing taxable income. Unlike traditional 401(k) plans, cash balance plans allow much higher contribution limits, often reaching six figures annually—with contributions fully tax-deductible to your business.
At Polzin Integrated Tax, we help design, implement, and manage cash balance plans that integrate seamlessly with your tax strategy, helping you keep more of what you earn while building a secure financial future.
What Is a Cash Balance Plan?
A cash balance plan is a type of defined benefit plan that blends the guaranteed benefit structure of a pension with the portability of a 401(k). It’s especially powerful for:
Business owners
High-income professionals (physicians, attorneys, consultants)
Late-career individuals seeking accelerated savings
Unlike a 401(k), contribution limits are based on your age, income, and plan design—often allowing well over $100,000 annually in deductible contributions.
Risks & Considerations
Commitment – Typically requires maintaining the plan for 3–5 years.
Funding Obligation – Annual contribution commitments must be met.
Complex Administration – Requires an experienced Third-Party Administrator (TPA).
Higher Costs – Administrative and compliance fees are higher than a simple 401(k).
Coordination Required – Must align funding and investment strategy with business cash flow.
How It Works
Employer Contributions – You make annual contributions on behalf of participants (often yourself as the owner).
Tax Deductibility – Contributions are fully deductible to your business, lowering your taxable income.
Tax-Deferred Growth – Plan assets grow without current taxation.
Portability – When you retire or leave the plan, the balance can be rolled into an IRA.
Who Should Consider a Cash Balance Plan?
Cash balance plans are best suited for:
Business owners with consistent, high profits
High-income professionals who have maxed out other retirement plans
Individuals in their 40s, 50s, or 60s who want to catch up on retirement savings quickly
Partnerships or professional groups (medical, legal, engineering) looking for tax efficiency and retention benefits
Opportunities With a Cash Balance Plan
Massive Tax Deduction – Reduce taxable income by six figures.
Accelerated Retirement Funding – Ideal for late-career catch-up contributions.
401(k) Add-On – Pair with a 401(k) for even greater savings.
Flexible Investment Choices – Conservative or growth-focused.
Exit Strategies – Ability to coordinate plan wind‑down with business exit planning.
Our Process
Initial Consultation – Review your income, tax position, and retirement objectives.
Plan Design – Customize contribution levels and investment allocation to fit your goals.
Implementation – Work with top TPAs for plan setup, compliance, and IRS requirements.
Ongoing Management – Annual review of funding, investments, and plan compliance.
Ready to Cut Taxes & Boost Retirement Savings?
Don’t leave six-figure tax deductions on the table. A well-designed cash balance plan can transform your retirement and tax strategy.