Most people believe you can shelter only $17,000, or 25%, of your income tax deferred in your retirement plan, and that contribution levels for all plan participants must be equal. That's because the majority of corporate America relies on 401(k) plans. If you're an owner or top executive of a small to mid-sized business, a 401(k) plan may prevent you from getting the benefits you deserve from your retirement plan. So what type of plan is right for your company? 401(k) Plans include employee contributions that are tax-deductible, earnings grow tax-deferred and withdrawals are taxable for participants which makes them attractive to many companies. Defined Benefits Plans offer the highest tax-deductible contribution. Contributions are based on the participants' ages and compensation, thus making defined benefits plans attractive to highly compensated business owners, partners, and key employees who are in their peak earning years, and usually the most mature employees. Profit-Sharing Plansoffer the maximum flexibility in employer contributions, allowing the employer to contribute and deduct from 0% to 25% of covered payroll each year. Experience has shown that the best plan design is often a combination of several. Every company is unique. Shouldn't your retirement plan be, as well? The bottom line is that Benetrends specializes in helping owners and top management of small to mid-sized companies derive the benefits they deserve from their retirement plans.
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