As a self-employed person, entrepreneur, or small business owner you have similar options for planning your retirement as those who are participating in company retirement plans.
SEP IRA: A Simplified Employee Pension Individual Retirement Account or SEP IRA is a tax-deferred retirement plan.
You can open a SEP IRA at a bank or other financial intuition and you can contribute up to 25% of your annual income.
However, much like the other retirement plans you may be charged a 10% penalty in addition to your taxes if you make a withdrawl before age 59 ½.
Self-Employed 401(k) plan: A Self-Employed 401 (k) plan is a tax-deferred retirement plan for self-employedpeople, sole-proprietorships, and partnerships.
You can contribute as an employee and as an owner, allowing you for more savings and tax benefits. However, as with many other plans you may be charged a 10% penalty in addition to your taxes if you make a withdrawl before age 59 ½.
SIMPLE IRA: A SIMPLE IRA or Savings Incentive Match Plan for Employees is one option if you plan on hiring an employee. It is a plan where you are able to contribute to your own retirement as well as match your employee contributions.
The SIMPLE IRA plan follows the same rules as a Traditional IRA.
For more information contact us for your complimentary, no-obligation 60 consultation and put your mind at ease…
A 401(k) plan is a tax-deferred retirement plan that is sponsored by your employer.
The information contained herein is not intended to constitute legal or tax advice. Tax issues involving retirement plans can be complex.
For specific information that applies to your circumstances you should consult a qualified legal/tax advisor. In accordance with IRS Circular 230 Disclosure, and to ensure compliance with requirements imposed by the U.S. Internal Revenue Service, we inform you that any tax advice contained in this material was not intended or written to be used, and cannot be used, by any taxpayer for the purpose of (1) avoiding tax-related penalties under the U.S. Internal Revenue Code or (2) promoting, marketing or recommending to another party any tax-related matters addressed herein.