At The Pension Design Group, we help business owners get the best of both worlds: increase retirement savings and reduce your tax liability. To help you estimate your potential tax savings and the amount you can contribute to retirement savings as a business owner, we’ve created a powerful calculator. This free tool utilizes the benefits of adding a cash balance pension plan to your new or existing 401(k) profit sharing plan.
Our user-friendly calculator allows you to input your age, income, and years in business. If you're married and your spouse is an employee, you can include their information, too, potentially increasing your deduction.
We've designed the calculator for real-time updates as you adjust the sliders, allowing you to explore various scenarios quickly. For entities taxed as corporation, enter your W-2 wage. Partnerships and sole proprietors should input net income from their K-1 or Schedule C.
We understand that inputs like age, income, years with the business, and spouse employment status all impact your potential contribution. Our team can help you explore strategies to increase your maximum deductible contribution, such as adjusting income, employing your spouse, or adding a 401(k) plan.
Our team of retirement plan management experts can also assist in evaluating whether a Cash Balance Plan makes financial sense for your business, considering your employees' ages and income levels.
At The Pension Design Group, we're here to answer your questions about Cash Balance Plans, including how contributions are calculated and ways to increase your potential deduction. Our expertise covers Cash Balance Plans, and we can help you determine which design best suits your objectives.
This calculation shows your benefit as a business owner. For calculations including employees and related obligations, please provide workforce details.
At The Pension Design Group, we understand that several factors influence your potential Cash Balance Plan contribution. Some of the most important ones include:
To maximize your Cash Balance Plan contribution, consider these strategies:
Structuring your income effectively can increase your contribution limit. This is particularly relevant for corporations, but remember to balance the benefits against potential increases in payroll taxes.
If feasible, employing your spouse can significantly boost your overall contribution. Even with a lower wage, this strategy can yield substantial benefits.
Adding a 401(k) Plan allows for additional contributions. For those 50 or older, this can mean an extra $30,500, plus potential profit-sharing allocations.
Assuming you do not have employees, you may have the opportunity to make after-tax contributions. While this would not reduce your tax liability, it would increase your retirement savings.
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