Along with saving taxes, a
retirement plan also secures your future. You can save more in taxes by choosing
the right kind of retirement plans according to your financial situation.
Before you select one, it’s important to know the various types of retirement
1. Individual Retirement
2. Roth IRAs
3. 401(k) Plans
4. 403(b) Plans
5. SIMPLE IRA Plans (Savings
Incentive Match Plans for Employees)
6. SEP Plans (Simplified
7. SARSEP Plans (Salary
Reduction Simplified Employee Pension)
8. Payroll Deduction IRAs
9. Profit-Sharing Plans
10. Defined Benefit Plans
11. Money Purchase Plans
12. Employee Stock Ownership
13. 457 Plans
14. 409A Nonqualified
Deferred Compensation Plans
Contributions to retirement
plans are usually tax deductible. You can claim a deduction on your individual
federal income tax return for the amount you contributed to your IRA. Roth IRA
deductions, however, are not deductible. With the exception of a Roth,
contributions and investment gains are not taxed until they are distributed.
retirement plans to their employees can help them save taxes and reduce turnover
by making this perk attractive to workers.
The sooner you start making
contributions to your plan(s), the more you will have when you retire. Before
setting up a retirement plan, consult a tax professional or a financial
institution that can provide further insight.
Labels: Business Tax, IRS, Tax Deductions, Taxpayers