Profit Sharing Plans For Small Business

Profit Sharing Plans For Small Business-40
Over the years, we’ve worked with a variety of different companies, including closely held corporations and family-owned businesses.We would be happy to help you explore potential profit-sharing plans and implement your preferred choice.

Simply give us a call at 417-447-4400 to set up an appointment.

The problem for business owners, though, is that retirement plans are almost a requirement if you want to attract and keep great employees. Plus, your employees benefit because smaller fees means they can contribute more to their retirement savings.

I am running a small business of 10 people, and am looking to expand the head count to 20 this year.

The business is profitable now, so I am thinking about how to create a profit sharing plan that REALLY WORKS in the sense that it will motivate people to do their best for the benefit of the company, and that will entice many more bright young people to join the company, and that will give people a sense of ownership into the company.

Instead, the term indicates a plan in which contributions to employees’ retirement accounts are made by the employer.

Therefore, a profit-sharing plan may help your company to attract, motivate, and retain valued employees. Our management fees are extremely low, which means you pay less.Stop wasting time trying to make sense of your legal responsibilities.Nuts & bolts Participation in a profit-sharing plan typically must be offered to all employees age 21 or older who worked at least 1,000 hours in a previous year.Employer contributions may vest over time, according to a plan’s specific terms. Withdrawals generally will be permitted at retirement, plan termination, and perhaps at other times, such as after age 59½. A profit-sharing plan may permit loans and hardship withdrawals, but withdrawals before age 59½ may trigger income tax plus an additional tax of 10 percent.These plans are flexible, so employers can contribute more in good years and less (or nothing at all) when business is slow.Considerable contributions Profit-sharing plans may permit employers to make relatively large, tax-deductible contributions to employees’ retirement funds.But I don't think the formula is applicable in my case here, for the simple reason that I'm no longer looking for co-founder.Our current profit sharing plan is actually quite simple: There's a bunch of profit at the end of the year and the amount over what the company conservatively needs to operate is split up amongst the employees based on how long they've worked at the company.Profit-sharing plans must have a set formula for determining how the contributions are allocated among plan participants, but they do not need to be traditional pro rata plans, as illustrated in example 1.Instead, profit-sharing plans may be structured to put a greater percentage of compensation in the accounts of certain employees.

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