401(k) Plan

A widely recognized plan that offers the most flexibility for employee and employer contributions. Plus, contributions are tax deductible for your business up to 15% of the total compensation of all eligible employees.

Consider a 401(k) if:

		You want to allow employees to defer a portion of their salary on a pretax basis
		You want to encourage participation in the plan by matching some portion of employee contributions

How it works:

		Employees choose to contribute a portion of their salary to the plan
		Your company may match all or part of employee contributions
		Your company may make discretionary contributions on behalf of all eligible employees, whether or not they defer salary into the plan
		You can establish a vesting schedule for the amount your company contributes
		You can allow employees to borrow against a portion of the account balance

Money Purchase Pension Plan

A plan that lets you make the same, fixed contribution amount each year.

Consider a Money Purchase Plan if:

		You have dependable annual cash flow and want to make fixed contributions for eligible employees each year
		You have no employees and want to maximize your annual contribution for yourself
		You want a single plan that allows the maximum tax deduction available

How it works:

		Your company must contribute the same percentage each year to employee accounts
		Fixed contributions for eligible employees may be up to 25% of annual compensation
		The plan may be combined with a Profit Sharing Plan to maximize your company's deductions while minimizing the amount you are required to contribute
		You can establish a vesting schedule based on an employee's years of service
		You can allow employees to borrow against a portion of the account balance

Profit Sharing Plan

An ideal way to reward employees for helping your business grow. It gives employees a sense of ownership, plus contributions are tax-deductible for your business.

Consider a Profit Sharing Plan if:

		You want to give employees incentive to increase profitability by linking contributions to business performance
		You want to reward longer term employees for their role in the growth of your business

How it works:

		Contributions can be made up to 15% of the annual compensation of eligible employees
		You can establish a vesting schedule based on an employee's years of service
		The plan may be combined with a Money Purchase Pension Plan to maximize your company's deductions, while minimizing the amount you are required to contribute
		You can allow employees to borrow against a portion of the account balance

Simplified Employee Pension Plan [SEP]

A low cost plan that is easy to administer.

Consider a SEP if:

		You want to make contributions for yourself and other employees for your prior fiscal year, but did not establish a plan by year-end
		You have no employees and are looking for a low-cost solution for your personal retirement needs and want to contribute more than the $2,000 IRA limit

How it works:

		All eligible employees establish an IRA
		Your company makes a contributions directly to each employee's IRA
		Tax-deferred company contributions can be up to 15% of the participant's annual compensation, subject to maximum dollar limits permitted by the IRS
		To be eligible, employees may be required to be at least 21 years old and have worked for your company for three of the past five years

Simple IRA Plan

A plan that rewards employees for systematically saving for retirement while having limited reporting and fiduciary obligations by the employer.

Consider a Simple IRA if:

		You have fewer than 100 employees earning at least $5,000 and do not maintain another employer-sponsored retirement plan
		You like the features of a 401(k) plan, but need the lower cost and administration of a Simple IRA plan
		You want to encourage participation in the plan by matching dollar for dollar the first 3 % of pay an employee contributes, but need some flexibility for less profitable years

How it works:

		All eligible employees can establish a Simple IRA
		Each employee who earned at least $5,000 annually during any two preceding years and can reasonably be expected to earn at least $5,000 in the current year is eligible to participate
		Each employee can contribute up to $6,000 in salary deferrals and your company is generally required to match the deferrals up to 3% of salary or to make a 2% of pay non-elective contribution for all eligible employees
		Employer contributions are non-forfeitable when made