g: 0 Posted By: jcb193
Views: 146 Replies: 0 I'll try to keep this simple.
We have a small father and son business.
- One full time employee- $35,000 a year
- Father and Son make about $500,000 in gross commissions a year, which comes out to about $300,000 a year in salary after expenses.
- Mother also works for salary in business (full time). ~$20,000
- I could also make wife an employee if this is advantageous too, as she works in the business as well (part time).
- Son and son's wife currently make max contribution to ROTH/Trad IRA every year.
I'd like to setup a company 401K-style plan, but wondering what is the most optimal setup, as I don't want to give my full time employee a ton of match, as it's money out of my pocket. Father and Son would like to sock as much away as possible.
From what I can gather, these are my two options:~~Sep IRA:
We can give up to 25% of our income (up to 50k). Nothing to employees. No costs.
No addition roth/tradition ira.401k:
We can give 100% of compensation (up to 50k). Have to give employees (2-5%) off the top (of their salaries).
Administrative costs ~$1200
Can also do a roth/tradition in addition