Plan Types

Let us help you select the correct plan.

A retirement plan has lots of benefits for you, your business and your employees. Retirement plans allow you to invest now for financial security when you and your employees retire. As a bonus, you and your employees get significant tax advantages and other incentives.

Business Benefits

  • Employer contributions are tax-deductible.
  • Assets in the plan grow tax-free.
  • Flexible plan options are available.
  • Tax credits and other incentives for starting a plan may reduce costs.
  • A retirement plan can attract and retain better employees, reducing new employee training costs.

Employee Benefits

  • Employee contributions can reduce current taxable income.
  • Contributions and investment gains are not taxed until distributed.
  • Contributions are easy to make through payroll deductions.
  • Compounding interest over time allows small regular contributions to grow to significant retirement savings.
  • Retirement assets can be carried from one employer to another.
  • Saver’s Credit is available.
  • Employee has an opportunity to improve financial security in retirement.

 

It is important that you select the correct type of retirement plan to suit your needs. If you select the wrong type, you may have problems accomplishing what your goals are.

For example, not selecting a safe harbor plan when a limited number of participants are contributing may mean the owners of the business will be limited as to what they may contribute.

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Click below, or give us a call at 1-888-934-4015. We’ll send you a proposal on all of the services we offer and how low it can actually cost to run your 401(k) plan with us.

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​We are experts at this. We can help you design the correct plan to meet your needs.  Here are a few plan types.

Traditional 401(k) Plan

Best used for employers who want to offer employees the benefit of a retirement plan. Depending upon employee contribution levels, maximizing owner contributions may not be a high priority.

  • Employer Contributions – May include discretionary matching contributions and discretionary profit sharing contributions.
  • Vesting Options – Common schedules include 100% immediate vested and 2-20, 20% vesting after the 2nd year and 20% each year thereafter. Other schedules may be implemented.
  • IRS Discrimination Testing – Must pass all IRS required discrimination and compliance testing requirements.

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Safe Harbor 401(k) Plan

Best used for employers who may have IRS discrimination testing issues. Owners and employees who wish to contribute up to the IRS maximum limits without concern for failure of IRS tests.

  • Employer Contributions – Must provide a guaranteed match or non-elective contribution to all employees who are eligible to contribute to the retirement plan.
  • Vesting Options – Safe harbor contributions must vest at 100%. Non safe harbor contributions may vest with common schedules such as 2-20, 20% vesting after the 2nd year and 20% each year thereafter. Other schedules may also be implemented.
  • IRS Discrimination Testing – Safe harbor plans receive a free pass on ADP, ACP and Top-Heavy testing requirements (the three most commonly failed tests).

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Cross Tested 401(k) Plan

Ideal for companies with wide age disparity and owners hoping to maximize contributions.

  • Employer Contributions – Combination of safe harbor contributions and discretionary employer contributions used to maximize benefits to group(s) of employees and owners.
  • Vesting Options – Safe harbor contributions must vest at 100%. Non safe harbor contributions may vest with common schedules such as 2-20, 20% vesting after the 2nd year and 20% each year thereafter. Other schedules may also be implemented.
  • IRS Discrimination Testing – Safe harbor plans receive a free pass on ADP, ACP and Top-Heavy testing requirements (the three most commonly failed tests). However other contributions must be tested using special methods.

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Are you ready to get started?

Let us send you a proposal with all of the services we offer and show you the value provided with our 401(k) plan.

REQUEST A PROPOSAL