As you know, good benefits play a major role in attracting and holding talented employees. A carefully considered retirement plan is key – not only to keeping your employees happy, but to providing you with a tax-advantaged method of saving for your own retirement. There are many types of plans, and the rules on employer-sponsored retirement plans are complex. Your financial professional can help you determine which plan will work best for your business. You should also obtain assistance from your tax advisor and/or attorney.

Defined Contribution Plans

These include profit-sharing plans, 401(k), Safe Harbor 401(k), Money Purchase plans and Age-Weighted/New Comparability Plans. They work for all types of businesses. Contributions are made by the employee and/or employer.

Defined Benefit Plans 

These also can work for all types of businesses and are especially attractive to companies with key employees over the age of 50 who have significant excess cash. Contributions are made by the employer. These types of plans allow the highest contributions and tax deductions.

Simplified Employee Pensions (SEP)

Simplified Employee Pensions are a good fit for sole-proprietors or businesses with only a few employees. They are simple, easy to set up and maintain, and have flexible contribution options. The employer makes the contributions for all employees.

Simple IRA

Savings Incentive Match Plans for Employees are IRAs that work best for businesses with no more than 100 employees. Both employees and employer may contribute. Administration of the plan is relatively simpler than with a 401(k).

Non-Qualified Deferred Compensation Plans

These plans provide desirable rewards for highly compensated key employees. They allow additional savings and potentially higher retirement income. Not all employees are offered this benefit, but the plans are not subject to discrimination testing. A further discussion of these plans can be found on our Executive Benefits page.

Please be advised that this content is not intended as legal or tax advice.  Accordingly, any tax information provided in this document is not intended or written to be used, and cannot be used, by any taxpayer for the purpose of avoiding penalties that may be imposed on the taxpayer.  The tax information was written to support the promotion or marketing of the transaction(s) or matter(s) addressed and you should seek advice based on your particular circumstances from an independent tax advisor.

Securities are offered through AXA Advisors, LLC (member SIPC). AXA Advisors, LLC does not provide legal or tax advice.