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Small Business Retirement Planning

   Retirement Planning | Small Business Retirement Planning

A retirement plan can accomplish two important functions for your business. First, it can lower your taxes. Second, it allows you and your employees to plan for the future, while in most cases, deferring taxes until the funds are withdrawn from the plan.*

How We Can Help

Since complying with the rules and regulations associated with retirement planning is often confusing, choosing an experienced financial expert is essential when designing a successful retirement plan. We are specialists in business retirement planning - that's what we do every day. We have the knowledge, experience and the necessary resources to help build a secure financial future for you and your employees.

Retirement Plan Options

SEP, SIMPLE and 401(k) plans offer a tax favored way to invest for retirement. You can deduct contributions you make to the plan for employees. If you are a sole-proprietor, you can deduct contributions you make to the plan for yourself. Earnings on the contributions are generally tax-free until you or your employees receive distributions from the plan.

  • SEP-IRA: A SEP-IRA (Simplified Employee Pension IRA) provides a simplified method for you to make contributions to a retirement plan for your employees. Instead of setting up a profit-sharing or money purchase plan with a trust, you can adopt a SEP agreement and make contributions directly to a traditional individual retirement account or a traditional individual retirement annuity set up for each eligible employee. A SEP-IRA is owned and controlled by the employee.

  • SIMPLE-IRA: A SIMPLE-IRA (Savings Incentive Match Plan for Employees-IRA) can be set up by an employer with less than 100 employees and who meets certain other requirements. Employees can choose to make salary contributions rather than receiving the money as part of their regular pay. In addition, employers contribute matching or non-elective contributions.

  • 401(k): With a 401(k) plan, employees can elect to contribute a portion of their wages to an investment account. In addition, employers may contribute to a 401(k) plan through employer matching contributions or a profit sharing program.

Defined Benefit Plans

Defined Benefit Plans, often called "pension plans", provide owners and employees a predetermined retirement income. There are two common types of defined contribution plans:
  • Profit Sharing Plans: In a profit sharing plan, your business agrees to contribute a percentage of its profits to a retirement plan that benefits both owners and employees.

  • Money Purchase Plans: In a money purchase plan, your business funds the qualified retirement plan with a fixed percentage of the company's profit every year, regardless of whether the company makes a profit.

Non-qualified plans

Non-qualified plans allow business owners to structure their retirement benefits according to a different set of IRS rules or without adhesion to some of the complicated IRS rules pertaining to qualified plans, the Employees Retirement Income Security Act (ERISA), and the Department of Labor. Non-qualified plans allow you and your employees to defer income into future tax years. While there are a few rules to follow, rules governing nondiscrimination and contribution limits are not among them.

Calculators

Select a calculator that can help you understand what the right financial plan can do for you and your employees, and why starting to invest early can make a big difference in the value of your portfolio over time.

  • Systematic Investing
  • Cost of Delay

    • Contact a Financial Advisor today

    Whether you're planning for retirement, funding a college education or protecting your assets, we can help.
    For a comprehensive review of your personal situation, always consult with a tax or legal Advisor. Neither Bancnorth Investment Group, Inc. nor any of its representatives may give legal or tax advice.

    *Retirement distributions will be subject to taxation upon withdrawal at then-current rates. Penalties may apply for early withdrawal. 10% IRS penalty may also apply to withdrawal prior to age 59 1/2.