Q. What are the requirements of some of the self-employment,
small business or individual retirement plans?
A. SEP IRA (Simplified Employee Pension Plan)
Have any self-employed income
Tax-deductible contributions, up to 15% of compensation,
up to $24,000 in 1999 plan year, and $25,500 in 2000.
The investment earnings grow tax-deferred until withdrawn.
This plan is simple to set up and administer.
IRA (Individual Retirement Plan)
Anyone with compensation
Can use in addition to your current retirement plan, even
if your current plan is a company plan or self-employment
plan.
Can Contribute up to $2,000 per year or 100%, whichever
is less.
For a homemaker filing a joint return, he/she can contribute
up to $2,000 in his or her own name.
This is not tax-deductible, but earnings grow tax-deferred.
As with all retirement accounts it is subject to eligibility
requirements. Roth IRA
Anyone can contribute $2,000. per year, not tax-deductible,
but investment earnings grow tax-free.
Federal taxes are not owed when withdrawn, and usually no
state taxes are owed.
You can contribute if your single income is $95,000 or less,
and your married income is $150,000 or less.
You must meet minimum eligibility requirements.
Keough
For small business and self-employed.
Can contribute up to 25% of compensation up to $30,000 per
participant, maximum.
This plan is difficult to set up and maintain.
These are some requirements, of some retirement plans. Browse
our bookstore for more information on retirement plans. Keep
in mind, new requriements emerge yearly.
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