|
Small business owner 401k
05-04-2012, 01:35 PM
|
#1
|
Confused about dryer sheets
Join Date: May 2012
Posts: 7
|
Small business owner 401k
I own a corporation. The corporation owns 3 other corporations each with its own fast food restaurants. I would like to setup a 401k for myself and a few of my managers. I wanted to know if my understanding so far is right.
1) For myself I will setup a Self-employment 401k
-I could contribute ~$50k
2) For my managers I will setup a 401k Profit Sharing system
-I could deduct up to 25% of their annual compensation (~$50k max)
-contribution could be adjusted based on profits (no contribution required)
The goal is to have as much net tax savings as possible. Where should I go to set this up? I see INGDirect offers a good program
|
|
|
|
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!
Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!
You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!
|
05-04-2012, 02:54 PM
|
#2
|
Thinks s/he gets paid by the post
Join Date: Jul 2005
Posts: 4,366
|
1) a Solo or individual 401k? You can't have any employees (other than family) for that one.
2) I don't think a 401k "for some of my managers" is allowed, if that excludes other employees.
If the top corporation is only you and your managers you might be able to set up one 401k for all. There are all sorts of restrictions related to treatment of highly paid employees and "regular" emloyees. It's not usually something you just sign up for online at Fidelity.
|
|
|
05-04-2012, 03:18 PM
|
#3
|
Moderator
Join Date: Feb 2010
Location: Flyover country
Posts: 25,199
|
Also, you'd probably get more responses if you put a question like this in a more appropriate section.
__________________
I thought growing old would take longer.
|
|
|
05-04-2012, 03:23 PM
|
#4
|
Administrator
Join Date: Jan 2008
Location: Chicagoland
Posts: 40,589
|
room7, welcome to the board. I'll move this to the FIRE and Money forum, and you might want to stop by here and tell us about yourself.
|
|
|
05-04-2012, 03:35 PM
|
#5
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2005
Posts: 17,205
|
Not that knowledgeable in what you are proposing... but I do not think what you are describing is a 401(k) plan, but a profit sharing plan... IOW, if the employee is not contributing, then the funding is all coming from a bonus (like profit sharing)....
With this small number of people, I would go to Fidelity and see what they offer... there are reps you can call...
If you are setting up a 401(k) where employees can contribute, I do think you would have to offer it to all employees up and down the corporate line... not at all sure about this, but it seems to be in the far reaches of my mind...
|
|
|
05-04-2012, 03:51 PM
|
#6
|
Confused about dryer sheets
Join Date: May 2012
Posts: 7
|
Quote:
Originally Posted by Animorph
1) a Solo or individual 401k? You can't have any employees (other than family) for that one.
2) I don't think a 401k "for some of my managers" is allowed, if that excludes other employees.
If the top corporation is only you and your managers you might be able to set up one 401k for all. There are all sorts of restrictions related to treatment of highly paid employees and "regular" emloyees. It's not usually something you just sign up for online at Fidelity.
|
1) Cant I have a i401k at the parent corporation which is only me
2) For managers only, can I qualify it by giving it to employees who are there 2+ years. Its a fastfood business so most people last 1 year. Or another option is I could hire my managers through the parent companies rather then the subsidiaries.
|
|
|
05-04-2012, 04:47 PM
|
#7
|
Full time employment: Posting here.
Join Date: Mar 2012
Location: seattle
Posts: 646
|
Look at a sep-ira.
|
|
|
05-04-2012, 04:55 PM
|
#8
|
Thinks s/he gets paid by the post
Join Date: Sep 2010
Location: midwestern city
Posts: 4,061
|
Bank of America has a full Small Business suite of tools and they work in coordination with ML to set up and run your 401k plans.
__________________
Very conservative with investments. Not ER'd yet, 48 years old. Please do not take anything I write or imply as legal, financial or medical advice directed to you. Contact your own financial advisor, healthcare provider, or attorney for financial, medical and legal advice.
|
|
|
05-04-2012, 11:04 PM
|
#9
|
Recycles dryer sheets
Join Date: Feb 2011
Posts: 225
|
You need to be asking at Fidelity or Vanguard. There are very strict rules from ERISA when you own a business and want to have a 401k. It's possible that you can do what you want to do, but you should not be taking that advice from people here, however helpful they can be. Ask the experts. And even then read the fine print.
|
|
|
05-05-2012, 12:40 AM
|
#10
|
Confused about dryer sheets
Join Date: May 2012
Posts: 7
|
Thanks everyone for the replies. I have learned alot but more questions to come haha
|
|
|
|
Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
|
|
Thread Tools |
|
Display Modes |
Linear Mode
|
Posting Rules
|
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts
HTML code is Off
|
|
|
|
» Recent Threads
|
|
|
|
|
|
|
|
|
|
|
|
|
» Quick Links
|
|
|