A qualified retirement plan can be a powerful tool for business owners—offering immediate tax advantages today and helping build long-term financial security for both you and your employees.
Key Benefits of a Qualified Plan
- Tax Deduction for Your Business
Contributions made to a qualified plan are generally tax-deductible, reducing your business’s taxable income. - Tax-Deferred Growth for Participants
Employees don’t pay income tax on contributions until they withdraw funds, allowing assets to grow tax-deferred. - Creditor Protection
In most cases, assets held in a qualified plan are protected from creditors, offering an added layer of financial security. - Life Insurance Integration
If life insurance is part of your financial strategy, certain qualified plans may allow premiums to be paid with pre-tax dollars.
What About Employee Contributions?
It’s a common concern: “Do I have to contribute for my employees too?”
Yes—but here’s the upside. The tax savings you receive may outweigh the cost of employee contributions. Plus, helping your team save for retirement can boost morale, retention, and your company’s reputation.
Wouldn’t you rather invest in your employees’ futures than pay more in taxes?
To learn more about how a qualified plan could work for your business, click here.
Important Disclosure:
Withdrawals from qualified plans are taxed as ordinary income. If taken before age 59½, they may be subject to a 10% federal tax penalty unless an exception applies.
The companies of National Life Group and their representatives do not offer tax or legal advice. Please consult your professional advisor for guidance specific to your situation. Qualified plans are offered and administered independently of the companies of National Life Group.
FAQs
- Do I have to contribute to a qualified plan for all my employees?
Yes, qualified plans typically require contributions for eligible employees. However, the tax savings and long-term benefits often outweigh the cost. Plus, offering retirement benefits can improve employee satisfaction and retention. - Can I include life insurance in a qualified plan?
In certain cases, yes. Some qualified plans allow life insurance premiums to be paid with pre-tax dollars. This can be a strategic way to meet both retirement and protection needs. Be sure to consult a financial professional to determine if this is appropriate for your situation. - What happens when I withdraw money from a qualified plan?
Withdrawals are taxed as ordinary income. If taken before age 59½, they may also be subject to a 10% federal tax penalty unless an exception applies. It’s important to plan withdrawals carefully to avoid unnecessary taxes and penalties.
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