Employer contribution Tag's Archives
Similar to a 401(k) used at companies across the country, a Solo 401(k) lets small-business owners share the fun and benefits. The business must be very small, however, limited to the owners of the business and their spouses.
The Solo 401(k) allows business owners to put away more money than a SIMPLE or SEP IRA, and there is some flexibility when it comes to contributions. You can contribute more or less every year, but a maximum of $16,500 for 2009.
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a.k.a. “Savings Incentive Match Plan for Employees“
The plans are designed for small businesses with no more than 100 employees who earned $5,000 or more on the payroll for the previous calendar year. But some advisers and tax professionals think these plans are more suited for much smaller companies.
It’s easy and simple. Including instructions, the account application is about four pages to fill out, and you can do it in 10 minutes.
- Who can open one: Generally an employer with no more than 100 employees.
- Cost and complexity: Low.
- Employer contribution limit: 3 percent of employees’ pay, matching, or 2 percent non elective.
- Employee contribution limit: $11,500 for 2009.
- Annual reporting requirements: None.
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