September '15

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120 • RV PRO • SEPTEMBER 2015 rv-pro.com Employer-sponsored savings plans raise employee satisfaction levels while also earning tax savings for the RV business. S aving for retirement is a laudable goal that too often gets put on the back burner. Wouldn't it be great if busi- ness owners and their employees were able to accumulate funds for their golden years while lowering their tax burdens? In fact, business owners can achieve both goals by establishing an employer- sponsored retirement plan. It's a nice perk that helps convey a sense of good- will toward an RV business's top talent, according to retirement planning experts. "For the small business owner, retire- ment plans are attractive for two rea- sons," says Barry R. Milberg, managing member of Milberg Consulting, Bluebell, Pa. "First, they are a means to attract and retain employees. Second, they can be good vehicles for sheltering taxable income." The right plan can help business owners plan for their own retirement, as well as that of their employees. And owners will save taxes three ways: First, employer contributions are deductible from business income. Second, employee contributions are not taxed until distributed to the recipient. Third, money invested in these programs grows tax-free. For those business owners who don't already have a retirement plan, experts advise that they start laying the groundwork now. And for those who already have one, experts suggest business owners take some time to review what they have to make sure they are maximizing the benefits for themselves and their employees. Pick a Plan What retirement plan is right? The answer's often not easy. Indeed, business owners can be faced with a bewildering array of options. Some plans require employer contributions; others don't. Some plans have annual contribution limits; others don't. And the more attractive the plan in terms of contribution limits, the greater the paperwork required, generally. Bottom line: Picking the right plan means balancing ease of record keeping with attractive tax benefits. Much of the decision is a judgment call and business owners may find themselves changing plans over time. "Before you identify the kind of plan you want, look at yourself as an employer," suggests Janice Wargo, an associate in the employee benefits group at the consulting firm of Plante & Moran in Auburn Hills, Mich. "Ask questions such as these: Why do you want a plan? Do you expect employees to make contributions? Do you employ any highly compensated individuals? How much do you want to contribute each year? How involved do you want to be in admin- istering a plan?" Keep It Simple Reduce costly paperwork by considering the simpler plans first. "Always look first at the plans that do not require annual governmental reporting," says Milberg. "Just consider the more complex plans if you are ready to contribute a sub- stantial amount of money and are willing to pay someone to help you remain compliant with federal regulations." So what plans are the easiest to admin- ister? Experts say they are called "IRA-based plans" and they come in three varieties: 1. Payroll deduction IRA ("Individual Retirement Arrangement), also called a "tra- ditional IRA." Experts say business owners can't find a plan that's easier to administer By Phillip M. Perry Earning Retirement Income, Earning Employee Loyalty

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