The most flexible qualified plans available, allowing for deferred sharing of profits among employees. Contributions are usually discretionary, allowing companies to vary deposits from year to year.

Very popular variations of profit sharing, allowing pre-tax employee contributions through payroll deductions, with or without discretionary employer contributions. Employee contributions reduce their gross earnings for state and federal income tax purposes.

The annual employer contribution level, once defined, becomes a mandatory company obligation unless the plan is amended. Participants can count on a certain level of employer contribution each year.

Provide a pre-defined annual retirement income for employees. Contributions are based on specific income requirements, along with actuarial variables such as years until retirement, life expectancy, compensation, etc.

Allow for employer contributions of company stock to participating employees. Can provide capital within the business for expansion or acquisition.

Combine features of defined benefit pension and profit sharing plans, allowing greater contribution levels for employees closest to retirement.

Establish two or more groups (“tiers”) of employees based on various criteria. Contribution rates may be different for each tier of participants.

  CHOOSING A PLAN