Retirement Plans

Quick Links

Hot Topics

Paychex Payroll Services: Sign up Today!

Need Some Deductions for 2011?

Don't overlook these!

10 Oddball Tax Deductions

11 Most Overlooked Tax Deductions

Updated for 2011

Retirement Plan Basics

<< Previous

Types of Retirement Plans

Private sector retirement plans may be IRA-based plans or qualified plans.

IRA-based plans are simpler and less costly to set up and administer than qualified plans.

As a self-employed individual and small business owner you can set up the following retirement plans for yourself and your employees (if any):

  1. IRA-based plans:
    • SEP plan (Simplified Employer Pension plan)
    • SIMPLE plan (Savings Incentive Match Plan for Employees)
  2. Qualified plan

Payroll Deduction IRAs

If you have employees and you don't want to adopt a retirement plan, but would still like to help your employees save for retirement, they could contribute to their own IRA through payroll deductions.

You, as the employer, arrange to transmit their funds to the financial institution where their IRA account is maintained.

For tax year 2011 an employee may contribute up to $5,000 through payroll deductions ($6,000 if 50 or older).

With a payroll deduction IRA, the employee is in the drivers' seat.

The employee...

Next:

Retirement Plan Basics: Choosing a Financial Institution

Next >>