How are supplemental executive retirement plans SERP taxed once the benefit is received?
When it is withdrawn/paid out, the original salary is taxable as is the investment growth. It is normally all taxed as ordinary income, even though the investment portion may have received a capital gain treatment…however, depending on the exact set up, sometimes the gain and salary can be differentiated and is taxable as each type. The SERP administrator should explain how and why the specific plan your in works.
