Post Severance Comp

[austin3515]

Medical practice has a deferred compensation plan. When a Dr. leaves the practice they are entitled to a deferred compensation payment which is almost entirely derived from the collection of receivables.

Is this payment for services rendered (subject of course to 2.5 months/last day of plan year) or ineligible deferred compensation, because it only becomes payable after severance from employment?

Or is the answer, you really need to dig into the particulars of the contract? This must come up often, so I'm hoping someone can offer a rule of thumb!

[austin3515]

I would like to clarify one thing - the most significant variable in determining the benefit is receivables, but for example, the payment is also determined based on number of years of service (the more service the bigger the benefit).