Bristol-Myers Squibb Employees: Exploring Exchange Funds and Tax-Efficient Strategies for Deferred Gains
Healthcare Provider Update: Healthcare Provider for Bristol-Myers Squibb
Bristol-Myers Squibb collaborates with multiple healthcare providers, including major national health insurers and pharmacy benefit managers (PBMs) like CVS Caremark and Express Scripts, to ensure patient access to their medications. Their widespread distribution network encompasses hospitals, clinics, and specialty pharmacies, enabling healthcare professionals to prescribe and dispense their pharmaceutical products effectively.
Potential Healthcare Cost Increases in 2026
As we look toward 2026, healthcare consumers should brace for significant cost increases stemming from a combination of factors. Record hikes in premiums for Affordable Care Act (ACA) marketplace plans are anticipated, with some states facing increases over 60% due to higher medical costs and the potential expiration of federal premium subsidies. Reports indicate that nearly 92% of marketplace enrollees could see their out-of-pocket premiums soar by over 75%, putting immense financial strain on families. Coupled with escalating hospital and drug prices, particularly specialty medications like GLP-1 weight loss drugs, the burden of rising healthcare expenses is likely to affect millions as they navigate their insurance options and healthcare needs.
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'Bristol-Myers Squibb employees should view capital gains management as part of a broader retirement strategy as flexible, tax-efficient planning tailored to individual circumstances can help preserve wealth over the long term.' – Paul Bergeron, a representative of The Retirement Group, a division of Wealth Enhancement.
'Bristol-Myers Squibb employees may benefit from retirement planning strategies that incorporate adaptable approaches. Flexibility in planning can better align financial decisions with evolving personal and economic circumstances.' – Tyson Mavar, a representative of The Retirement Group, a division of Wealth Enhancement.
In this article we will discuss:
Personalized and adaptable tax-efficient planning for Bristol-Myers Squibb employees.
Deferred gains and tax-free diversification strategies, including §721 Exchange Funds and §351 ETF conversions.
Additional methods such as charitable donations, remainder trusts, and collars for managing capital gains.
Patrick Ray, a Wealth Enhancement financial advisor, highlights the importance of personalized tax-efficient planning when determining the best way to mitigate capital gains taxes on a highly valued position. 'Retirement planning is not a one-size-fits-all approach,' he notes. 'It requires tailored strategies that address unique factors such as tax-efficient withdrawals.' For Bristol-Myers Squibb employees, effective planning—which can include using tax-efficient tools like donor-advised funds or donating appreciated shares to charity selectively—means taking a customized approach based on your unique tax bracket, liquidity requirements, and long-term objectives, particularly when it comes to managing significant capital gains.
For his part, Wealth Enhancement advisor Tyson Mavar emphasizes the necessity of adaptable planning tools, pointing out that traditional guidance could be misaligned. 'Retirement planning is particularly complex for investors juggling estate considerations and significant capital gains,' he says. For Bristol-Myers Squibb professionals, this viewpoint encourages investigating tactics that provide customization, timing flexibility, and tax efficiency based on your financial needs, such as charitable remainder trusts, tax-loss harvesting, or conversions into exchange traded funds (ETFs).
Tax-deferred diversification
: Allows you to receive shares in a diversified portfolio without paying capital gains tax immediately by contributing a concentrated stock position to a pooled exchange fund.
Deferred gain
: Your initial cost basis carries over pro rata, and taxes are postponed until you sell the shares of the diversified portfolio.
Accessibility
: Usually restricted to qualified or accredited buyers, frequently requiring sizeable minimum deposits (between $100,000 and $1 million or more).
Hold period
: Prior to redemption, funds typically impose a seven year lock-up.
Diversification structure
: To prevent being classified as an “investment company,” which would otherwise result in immediate taxation, exchange funds are frequently structured with about 20% in non-stock assets, such as real estate.
For Bristol-Myers Squibb employees holding concentrated stock, this can provide a structured way to defer taxes while broadening exposure.
Restrictions
Limited liquidity—capital remains locked in for the time being.
High-net-worth investors are generally the only ones able to meet the fees and entry requirements.
You still retain diluted exposure to your original position following the exchange, known as residual exposure.
2. Tax-Free Seeding Into Tax-Efficient Vehicles via Section 351 ETF Conversions
Mechanism and Advantages
Tax-free transfer
: If IRS regulations are followed, you can trade shares of an ETF for a diversified portfolio (such as separately managed account holdings) without recognizing a gain.
Diversification guidelines
: The portfolio must satisfy §368(a)(2)(F)'s 25/50 diversification test, which states that no single holding may account for more than 25% of the portfolio’s value and that the top five holdings cannot exceed 50%.
Control requirement
: Immediately after the exchange, contributors must jointly own at least 80% of voting power and 80% of all share classes.
Continuous in-kind rebalancing
: The ETF structure allows for tax-efficient rebalancing through in-kind transactions, postponing future gains until ETF shares are sold.
For Bristol-Myers Squibb investors, these mechanisms can be especially valuable if they are already well diversified and seeking long-term tax efficiency.
Restrictions
Eligibility
: Only well-diversified portfolios qualify; concentrated single-stock holders may not benefit unless already diversified.
Cost and complexity
: Requires operational, fund-structuring, and legal setup, often used by institutions or wealthy investors.
3. Collars and Charitable Giving Strategies
High-income investors often use strategies like charitable giving, donor-advised funds, charitable remainder trusts, and collars with borrowing to manage capital gains taxes.
Giving to charity
: Donating appreciated stock directly or through a donor-advised fund can result in a charitable deduction and reduce exposure to capital gains tax.
Charitable remainder trusts (CRTs)
: These generate income while deferring capital gains taxes, with the remainder eventually donated to charity.
Borrowing and collars
: Borrowing against stock provides liquidity without a taxable sale, while collars set boundaries on downside risk. These tactics must be properly structured to prevent constructive sale treatment under §1259.
How does the Broward Health Cash Balance Pension Plan ensure the financial security of its employees upon retirement, and what are the specific benefit options available to employees who retire or terminate employment with Broward Health? Discuss the implications of choosing a lump sum versus a monthly benefit and how these choices affect overall retirement income.
Financial Security and Benefit Options: The Broward Health Cash Balance Pension Plan provides financial security by offering a defined benefit based on hypothetical account balances. Upon retirement or termination, employees can choose between a lump sum payment or a lifetime monthly benefit. The lump sum provides immediate access to funds, but opting for a monthly benefit ensures a steady income throughout retirement, which could lead to a more stable financial situation over time.
How does the retirement savings plan at Bristol-Myers Squibb Company compare to similar plans in the biotech and pharmaceutical industry, particularly regarding company matching contributions and employee deferral options? What factors should employees consider when deciding how much to contribute to their retirement accounts at Bristol-Myers Squibb Company?
Early Retirement Accommodations: Employees can retire early if they are at least 55 years old and have completed 5 years of vesting service. Benefits received upon early retirement are typically smaller compared to those received at the normal retirement age of 65. The normal form of benefit payment for early retirees is an actuarially adjusted life annuity based on the cash balance account at the time of early retirement(Broward Health_June 201…).
Bristol-Myers Squibb Company offers various retirement plans, including 401(k) plans and non-qualified deferred compensation plans. Can employees elaborate on the differences between these plans and how each one impacts their long-term retirement savings? Furthermore, how can an employee evaluate which plan best suits their individual retirement goals?
Vesting Schedule and Rights: The Broward Health Cash Balance Pension Plan uses a vesting schedule that grants full vesting rights after 5 years of service. Employees with fewer than 5 years of service are not eligible for benefits and forfeit their account balance. Vesting means employees gain the right to their accrued benefits, which become payable when employment ends(Broward Health_June 201…).
Based on the changes in IRS regulations for 2024, how might they affect Bristol-Myers Squibb Company's retirement and savings plans? Are there any new contribution limits or eligibility rules that employees should be aware of, and how can they adapt their savings strategies accordingly?
Role of the Pension Plan Committee: The Broward Health Pension Plan Committee administers the Cash Balance Pension Plan, ensuring compliance with laws and the plan’s financial health. The committee is responsible for investment decisions and approving plan changes, and it ensures that benefits are paid accurately and in a timely manner(Broward Health_June 201…).
What are the implications of taking an early withdrawal from retirement funds at Bristol-Myers Squibb Company, and how does it affect an employee's financial future? Employees should also consider what alternatives to early withdrawal exist within the company's policy framework.
Changes or Amendments to the Plan: The plan can be amended or terminated, but employees' vested rights are protected. Changes do not reduce accrued benefits from prior contributions, and the plan's termination follows a specific order to prioritize benefit distributions(Broward Health_June 201…).
Employees often have questions about post-retirement benefits, especially concerning medical coverage. What policies does Bristol-Myers Squibb Company have in place to ensure continued healthcare coverage for retirees, and what are the eligibility criteria for these benefits?
Recognition of Past Service upon Re-employment: If employees return to Broward Health after a break, their prior service may be recognized depending on vesting and benefit conditions at the time of rehire. Those who were vested before leaving can have their prior benefits restored, and contributions can resume after re-employment(Broward Health_June 201…).
How does Bristol-Myers Squibb Company handle the integration of pension benefits during mergers or acquisitions, and what can employees expect if they find themselves in such a situation? It would also be important for employees to understand their rights and options during these transitional phases.
Beneficiary Designations: Employees can designate beneficiaries to receive benefits if they die before or after retirement. Beneficiaries can receive lump sums or monthly payments, depending on the employee's retirement eligibility. Failure to designate a beneficiary may result in benefits going to the surviving spouse, children, or other family members as per the plan's order of priority(Broward Health_June 201…).
In light of recent company performance, what are Bristol-Myers Squibb Company’s future benefits projections, especially regarding pension plans? How can employees utilize this information to better plan for their retirement saving strategies?
Interest Credits on Accounts: The interest credits for cash balance accounts are determined based on U.S. Treasury rates, with a minimum annual interest rate. Interest is applied monthly, enhancing the account value and ensuring that employees' retirement savings grow over time(Broward Health_June 201…).
Given that Bristol-Myers Squibb Company has a robust benefits architecture, what specific programs or platforms are in place for employees to seek clarifications on their retirement benefits? How can Bristol-Myers Squibb company employees efficiently navigate these resources to address their individual inquiries?
Challenges in Filing Claims: The process for filing retirement claims involves notifying Broward Health and submitting the necessary paperwork 30 to 60 days before retirement or termination. In case of a denied claim, employees have the right to request a review and appeal, ensuring fair treatment and timely resolution(Broward Health_June 201…).
For employees looking to gain more information about retirement benefits and other related policies, how can they contact Bristol-Myers Squibb Company effectively? What communication methods are recommended to ensure that their questions are addressed promptly and comprehensively?
These questions should provide employees with a deeper insight into their retirement planning while encouraging them to explore the benefits offered by Bristol-Myers Squibb Company further.
Contacting Broward Health for Information: Employees can contact the Employee Benefits department at Broward Health to learn more about the Cash Balance Pension Plan. Resources such as retirement counseling sessions and detailed plan descriptions are available to help employees understand their benefits and make informed decisions(Broward Health_June 201…).
With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.
In process of terminating U.S. Retirement Income Plan, transferring $3.8 billion of its pension obligations. Previous $1.4 billion transfer to Prudential for 8,000 retirees.
Bristol-Myers Squibb announced a restructuring plan that includes layoffs of approximately 1,200 employees.
Bristol-Myers Squibb offers RSUs to executives and certain employees. The RSUs vest over a three-year period, promoting long-term company performance and employee retention.
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For more information you can reach the plan administrator for Bristol-Myers Squibb at 430 East 29th Street New York, NY 10016; or by calling them at +1 212-546-4000.
Further Information for Bristol-Myers Squibb* Employees
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