Suresh is sales representative for Swinley Manufacturing. The corporation maintains a defined contribution profit sharing plan on behalf of its employees. The company contributes 15% of each employee's salary. Suresh's salary for the year is $200,000. Because of his record sales achievement during the year, the company decides to pay Suresh a bonus of $75,000. Suresh is aware of the tax benefits associated with pension plans and has asked the controller of the company to pay him $35,000 of the bonus in cash and to contribute the remaining $40,000 ($75,000 - $35,000) to his pension. Prepare a letter to Suresh explaining the tax consequences of his proposal.