• Self employed with spouse as only employee

• Sole Proprietors

• Limited Liability Corporations (LLCs)

• Partnerships

• S and C Corporations

• Self employed with no employees

• Small businesses with employees

• Sole Proprietors

• Limited Liability Corporations (LLCs)

• Partnerships

• S and C Corporations

• Self employed

• Small businesses with 4 or less full time employees

• Sole Proprietors

• Limited Liability Corporations (LLCs)

• Partnerships

• S and C Corporations

• Companies with 100 or fewer employees

• Sole Proprietors

• Limited Liability Corporations (LLCs)

• Partnerships

• S and C Corporations

• Provides benefits similar to Traditional 401k with less administration

• May permit greater contributions than SEP IRA, SIMPLE IRA or profit sharing plan without the rigid funding requirement of a Defined Benefit Plan

• Easy to administrator

• Low cost

• No required IRS reporting

• Annual funding not required

• Employer must contribute to eligible employee accounts in any year that the plan is funded

• Provides the maximum allowable tax deductible retirement plan contribution.

• Easy to administrator

• Low cost

• No required IRS reporting

• Largely funded by employee contributions, but limited employer contribution required

• Salary deferrals up to 100% of compensation

• Up to $15,500 or $20,500 if age 50+ in 2008

• NONE

• NONE

• Up to 100% of compensation

• If age 50+ in 2008, up to $10,500 or $13,000

• Profit sharing contributions up to 25% of compensation.

• If age 50+ in 2008, employer and employee contributions have a combined maximum of $46,000 or $51,000

• Employer funds 100%

• In 2008, up to 25% of compensation with a maximum of $46,000

• 100% funded by employer

• Annual contribution calculated yearly by actuary

• Defined benefits plans provide the maximum allowable tax deductible retirement plan contribution

• Employer’s have a mandatory match and must select from 1 of 2 matching formulas

• Match employee contributions dollar for dollar up to 3% (up to a maximum of $10,500 or $13,000 if age 50+ in 2008.

• A 2% match of employee compensation to all eligible employees regardless if the employee is electing to defer a portion of their salary or not (up to $4,600 in 2008)

ITEM COMPARED

INDIVIDUAL 401k

SEP IRA

DEFINED BENEFIT PLANS

SIMPLE IRA

• Must file IRS Form 5500 when plan assets are greater than $250,000

• No required employer tax filings

• An actuary makes annual calculations to determine the amount to be contributed to achieve the retirement income goal

• No required employer tax filings

• Tax free loans are allowed

• 50% of total 401k value can be borrowed up to maximum of $50,000

• Withdrawals prior to 59 years and 6 months are permitted, but may be subject to a 10% penalty plus income taxes

• Hardship withdrawals are permitted

• Loans are available if this feature is elected when plan is adopted

• Receiving a loan may increase the annual required contribution

• Withdrawals prior to age 59 years and 6 months are permitted, but may be subject to 25% penalty if taken within the first 2 years of participating in SIMPLE IRA.

• An additional 10% penalty may apply for withdrawals prior to age 59 years and 6 months in addition to regular income taxes

• December 31 st or fiscal year end

• Personal tax filing deadline if a sole proprietor plus extensions or the business tax filing deadline if incorporated plus extensions

• Must set up by December 31 st or fiscal year end

• Must be established by October 1st