COLLECTED WISDOM™ On Solo(k) Retirement Plans

The self-employed used to say that 401k plans weren't in tune with their needs-but thanks to the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA), they're now singing their praises. While EGTRRA did not explicitly create a new type of retirement plan, it made a number of constructive changes to existing laws governing 401k plans. In doing so, the legislation had an unintended benefit - one that caters to the distinctive needs of small businesses where the owner or owners are the only employees - increased contribution limits.

Here is information to help you understand and pursue a Solo 401k plan.

SEP vs. Solo 401k - Summary: The best choice for you depends on your self-employment income for the year. It's easier to set up a SEP, but you may be able to contribute more money by opening a solo 401k. Located at: Kiplinger, December 2007. Click on headline for full article.

Solo 401k Plans - Great Benefit for the Sole Proprietor - Summary: Solo 401k plans are ideal for individuals who can save large sums. With an individual 401k, you save both as an employee and an employer. That feature allows the typical business owner to put away more than in most retirement plans. Located at: Accountingweb.com, June 2007. Click on headline for full article.

Solo(k) Provider List - Summary: Free List of Solo(k) Vendors Available from 401khelpcenter.com. Located on: 401khelpcenter.com. Click on headline for full article.

Solo(k) Plan Contribution Calculator - Summary: Free calculator to help you determine whether a Solo(k) is right for you when it come to contributions. Located on: 401khelpcenter.com. Click on headline for full article.

One-Person 401k's May Make Sense for Owner-only Businesses - Summary: If you are self-employed, rule changes contained in the 2001 tax bill may make a one-person 401k plan a viable alternative to other retirement plans for small businesses. One catch is that it likely wouldn't be cost-effective if your business has any employees who would be eligible for the plan. Contributions to a one-person 401k plan are based on revenue generated by your business. If you participate in any other plan, with another employer, you must coordinate one-person 401k contributions with that plan so you meet the IRS limits described below. Here's a look at the 401k plan for one. Located on: 401khelpcenter.com. Click on headline for full article.

The Single-Participant 401k - Summary: The 401k plan has been around for more than 20 years, permitting Americans to amass billions of dollars in retirement assets. With the passage of the Economic Growth and Tax Relief Reconciliation Act of 2001 millions more self-employed or small business owners with no employees (other than their spouse) have a new incentive to set up a 401k plan and increase their retirement savings. Located on: American Institute of Certified Public Accountants. Click on headline for full article.

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