V.R. DeAngelis M.D.P.C. & R.T. Domingo M.D.P.C., V. R. DeAngelis M.D.P.C., Tax Matters Partner, et al. - Page 20
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reorganize the participating employers into other or separate
V. VRD/RTD’s Introduction to the STEP Plan
A. Introduction to the Plan
In late 1993, Drs. DeAngelis and Domingo were engaged in
estate planning with their accountant, Richard Freeman (Mr.
Freeman), and an estate planning attorney, Victor Finmann (Mr.
Finmann). Mr. Freeman advised Dr. DeAngelis to acquire
additional life insurance coverage and suggested that he consider
a severance pay plan for VRD/RTD. Mr. Freeman introduced Dr.
DeAngelis to Mr. Rapp. Mr. Rapp discussed the STEP plan with Dr.
DeAngelis and Mr. Freeman, characterizing the plan as a way to
receive additional insurance coverage and to provide severance
benefits, both with pretax dollars. Mr. Rapp recommended to Dr.
DeAngelis that VRD/RTD form a section 419 welfare benefit trust
because, he stated, it would secure immediate Federal income tax
deductions, allow the owner-employees to accumulate significant
wealth on a tax-deferred basis, secure assets with insurance
company guaranties, and protect assets from creditors. Dr.
DeAngelis discussed the STEP plan with the other doctors, their
wives, Mr. Finmann, and others. Mr. Finmann advised Dr.
DeAngelis that he was skeptical as to the validity of the STEP
plan, as promoted.
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Last modified: March 27, 2008